Decentralization is not a dirty word in hospitality

When evaluating the basis of a decentralized hotel marketplace, as a travel agent or online travel agency, you’d be forgiven for telling most people to go wash their mouths.

Anything that could potentially exclude you from the supply chain is an absolute no-go and should be eliminated immediately.

On the other hand, for a hotelier and their paying guests, this all makes perfect sense.

But the reality is much less black and white.

Estimate

OTAs could be faster in developing blockchain-based concepts to surpass all aspiring indie startups because OTAs have the capital, wallet, and established infrastructure to switch technology concepts.

Vinod Kelwani – Technoheaven

Blockchain technology forms the basis of a decentralized platform that connects consumers to hotels without charging large commission fees. Tech companies that provide blockchain solutions can save consumers up to 50% on traditional booking fees.

This is no small beer and hotels are seeing the benefits of blockchain platforms globally. TUI has used the system to swap beds between its properties, moving 100 million room nights to its private blockchain where demand is highest.

We see more and more hotels using our own system with reservations, payment processing and data sharing systems for direct guest transactions. The software allows real-time transactions without middleman fees.

Blockchain technology has made steady progress in recent years. Hotels can publish and edit their room listings, lock deposits for future disputes and refunds, and accept direct payments. Guests can find and book rooms and if there is a dispute, an independent arbitrator can step in to resolve the issue.

But that doesn’t mean OTAs will struggle to find their role in a decentralized market or be squeezed out with smaller margins and fewer bookings.

Far from there.

Beyond the Hypo Blockchain

As someone who has been involved in travel technology for a long time, I’ve seen the hype and the many group discussions about the future of OTAs. I’ve seen technology come and go and new innovations meant to mark the end of this key part of the travel ecosystem.

But the OTAs are still there. Blockchain technology allows buyers to complete a transaction without the need for a trusted bank, credit card, or clearinghouse, but it’s not always trust that draws buyers to OTA. They choose them because they offer a choice.

They deliver relevant content and search results in an efficient and superior user experience with clear messaging. OTAs spend billions of dollars to acquire customers through their marketing and advertising spend and they maximize conversions by investing in technology and easy-to-use websites with options and pricing tiers.

Current centralized systems are also engaged in adapting blockchain technology. The Big Four in the world of centralized booking platforms have all the necessary elements for instant and cost-effective implementation: financial resources, sophisticated IT structures, global business networks and a large international community of customers.

OTAs could be faster in developing blockchain-based concepts to surpass all aspiring indie startups because OTAs have the capital, wallet, and established infrastructure to switch technology concepts.

The current centralized system uses blockchain technology as an adjustment to eliminate new competitive threats. The four major travel booking platforms in the world have all the necessary elements for an instant and profitable implementation.

Their competitive edge will surpass any new institution in this industry at every level.

There is still a long way to go, but blockchain is not going to wipe out OTAs. It gives people a choice and it encourages competition, and that’s not a dirty word.