American Airlines tickets may not be available on Orbitz much longer. Image: Wikimedia Commons

Update: American Airlines pulls fares from Orbitz on 12-22-10.

In a ruling issued on Tuesday, a judge blocked Orbitz’s restraining order against American Airlines. American wants to block Orbitz from selling tickets on its airline. American claims this move will help them cut costs; consumer advocates question the results of this action.

American Airlines wants to cut out Orbitz

American Airlines first announced that they would take their listings off Orbitz on Dec. 1. An injunction to prevent American Airlines from taking that action was filed. Travelport Ltd., which is a privately-held company that owns 48 percent of Orbitz, brought this action. Though a Chicago judge turned down the motion, American Airlines has not yet pulled their listings. American claims that by cutting ties with Orbitz, they will help reduce the cost of their tickets by cutting out brokerage and commission fees.

The structure of online travel purchasing

The steps American Airlines has taken to take itself off Orbitz is an effort to cut costs. Online travel sites, such as Orbitz, Travelocity, Kayak, Expedia, and Priceline, get their booking information from “global distribution systems.” When an airline ticket is booked through an online site, the airline pays a part of that ticket price to the global distribution system as a fee, and a part of that ticket price as a commission to the travel site. This three-tiered system allows for comparison shopping, but also increases costs to the airline. Some discount airlines, such as Southwest and JetBlue, do not participate in online comparison shopping to help reduce their costs.

Consumer advocates concerned about Orbitz move

Though American Airlines has threatened to take their listings off Orbitz, they have not made the same move to other global distribution system websites. Airline industry consultants applaud American’s move to get their listings off Orbitz as a cost-cutting move. Consumer advocates, however, are worried that by taking their tickets off comparison-shopping sites, American Airlines would be able to charge higher prices for their tickets without as much competition.

Sources:

NPR.org
LA Times

Hipmunk is taking off this week, and the reviews of the visually striking flight search website are quite positive. (Photo Credit: CC BY/Wang Huasheng/Picasa)

It started out as a simple summer project for young Adam Goldstein, and now Hipmunk may be the most innovative way for an online flight search. With a little help from friend and Reddit co-founder Steve Huffman, Goldstein took an old dog and taught it a bevy of new tricks, reports CNN Money. In strokes of brilliant color and user-friendly interface arrangement, Goldstein may have just painted his way into the big time.

Online travel gets hip with Hipmunk

As opposed to a boring text list of flights, Hipmunk dresses the entire process in color and arranges flights on an easy-to-analyze grid. Hipmunk just launched this week, but tech industry reviews are glowing. TechCrunch writes that “When you see the results you’ll never want to see flight results in any other format.” Lifehacker has similar praise for the “fantastic” visual interface, which is gratifying to Goldstein, as that his team spent a great deal of time on that aspect of Hipmunk. There’s no clutter of text and buttons, just a color-coded arrangement of airlines. Searchers and easily zoom in on a favorite in the grid at any time for additional information.

Winging it with ‘a small, cute animal and a good logo’

Goldstein and Huffman met with a number of online flight booking sites before settling on a deal with Orbitz, one of the most popular online travel aggregators. Flights found on Hipmunk are booked via Orbitz and both sites benefit monetarily from the transaction. Hipmunk’s chipmunk in flight goggles will no doubt bring the company the kind of brand recognition Twitter enjoys with its bluebird. The choice of mascot came from Goldstein’s girlfriend, reports CNN.

“She said, ‘If you pick a small, cute animal and a good logo you’ll never go wrong,’” Goldstein says.

Storing acorns for winter

Hipmunk is still in the early process of its evolution and is stockpiling ideas for how to improve. Issues like expanding search functions and monetizing the site in ways that don’t bombard users with spam are on Goldstein’s agenda. Expanding into hotels and auto rentals may be a likely move. It will be interesting to see how Hipmunk maintains its Zen-like design as additional content is added to the user experience. Whatever happens, the search for cheap flights is now less frustrating for searchers than ever before.

Sources:

CNN Money

Hipmunk