Hostelworld has acquired Hostelbookers!!!
Hostel Trends and News
Oh snap.
This is certainly going to ruffle some feathers and potentially have a HUGE impact on the industry. I cannot see this being AT ALL good for hostels or guests...
http://www.irishtimes.com/business/wri-acquires-hostelbookers-1.1357196
- Comments
11 years
I cannot see this being a good thing at all, either. I hope it gets blocked by the UK and Irish authorities.
I wonder if websites like Hostels 247 or Hostel Club will take this as an opportunity to compete better.
11 years
If they include the service charge in Hostelbookers it will make no sense to have a Hostel advertised in Hostelbookers, i think this will in fact let other small companies grow faster if they play their cards right .
The good news is that we will have all reservations comming just from one page and we will say bye bye to overbookings :)
I do have mixed feelings about this situation feels like we have lost something but i dont see what it is at this moment . :rolleyes:
11 years
Not sure about this... My big pet peeve with hostelworld has always been the booking fee to guests. Hostelbookers does not charge this. Is this going to change? If the 2 sites are completely left separated I wouldn't see the use of merging. In the email sent they mention specifically "savings in google pay per click ads", which to me would indicate the longterm planning is to send all traffic to 1 website instead of advertising for 2. I wonder if this will open up the market for a new player to come in? The plus side would be increased funding available to market the budget market as a whole, and as such increase the number of people using hostels. But then hostelworld has been adding more and more non-hostels to their system...
11 years
It seems like that deal would remove nearly all competition between booking sites in the hostel industry. Except for HostelsClub and GoMio, nearly everything else is an affiliate site of Hostelworld or Hostelbookers. There is hihostels.com, but that is a closed network that is not open to most hostels.
I hope it gets blocked by the UK and Irish authorities.
Is the transaction based in the UK and Ireland? I think WRI was purchased by a company in the US, but it might now be in Luxembourg.
11 years
A few articles about this, all saying essentially the same thing:
WRI: Web Reservations International (WRI) agrees acquisition of HostelBookers
Tnooz: Massive consolidation: HostelWorld buys HostelBookers
Skift: Low-end rollup continues as Hostelworld parent acquires HostelBookers
Travelution: Hostelbookers acquired by Dublin-based firm
From WRI CEO, Feargal Mooney:
WRI’s mission is to be the fastest-growing online provider of great value accommodation, using innovative technology to inspire independent-minded travellers everywhere.
…
To compete head-to-head with the ‘big beasts’, like Expedia and Booking.com, we need to invest. The capacity to inject more resources into online marketing and technology is absolutely key to this sector, and our increase in scale will enable us to ramp that activity up in the face of some very large and dominant competitors.We want to provide a service that both competes head to-head with the large online travel agents, and retains the personal service and sector knowledge that comes from being a smaller, budget-focused player – meeting the needs of hostels, B&Bs and smaller hotels, and providing enhanced service to our customers and partners.
Details of the purchase have not been released yet.
Hostelbookers COO David Smith sent this email announcement to hostels today. (all bold text is in the email, not my own)
Subject: HostelBookers Merger With Web Reservations International
Dear Partner,
CREATING A MORE EFFECTIVE AND SMARTER PARTNER FOR YOUR BUSINESS
We wanted you to be among the first to know about an announcement being made today. Web Reservations International, which operates the award winning web-sites hostelworld.com, hostels.com and bedandbreakfastworld.com, is to merge with HostelBookers.com Limited, which operates the hostelbookers.com and anytrip.com web-sites.
This is good news for all participants in the budget accommodation sector, whether a hostel, hotel or B&B, as the merger will create a more effective and smarter partner for your business.
We also believe that this is an exciting development for property owners, for two key reasons.
Firstly, it will help us improve our service to you and drive increased occupancy of your properties.
We will continue to invest in the individual website brands and the enhanced resources of the combined businesses will allow us to:
- Invest more in marketing and services, especially Pay Per Click advertising on Google, attracting more consumers to the web-sites and to your properties
- Increase investment in technology platforms to improve the efficiency and ease of use of our systems and sites, for both property owners and consumers
- Enhance our levels of support to you as property owners.
Secondly, the merger will help maintain a competitive marketplace for you to attract consumers to your properties.
We want to provide a service that competes head to-head with both the larger and more expensive OTAs like Booking.com and Expedia and the smaller, budget-focused players in the market. We believe that you will benefit from this merger, which brings scale to an operator focussed on the budget accommodation sector while retaining the personal touch and sector knowledge of a smaller player.
As is common, this transaction will be subject to regulatory approval and it will be business as usual for both organisations while this process takes its course, which may take some months. During that time we shall continue to operate completely independently and there will be no change to your day-to-day relationship with the websites.We shall keep you informed of progress and please be assured of both organisations' complete commitment to service continuity both before and after the merger is completed.
In the meantime, we hope you will share our enthusiasm for the merger as it will enable us to provide you with an even greater range of services, including enhanced investment in technology, customer service, marketing and property support.We believe the net result will be more beds filled, on more nights of the year, for more of our property owners.
We look forward to our continued partnership.
David Smith
COO HostelBookersFeargal Mooney
CEO WRI
11 years
From WRI:
The all-paper deal will require regulatory clearance before it can complete.
From David Smith:
As is common, this transaction will be subject to regulatory approval and it will be business as usual for both organisations while this process takes its course, which may take some months.
Does anyone know what the regulatory process is for a merger like this? What are the steps involved? What is the final decision based on? Who makes that decision?
11 years
Who makes that decision?
This guy:
http://ec.europa.eu/commission_2010-2014/almunia/index_en.htm
But I doubt the EU commission will bother with the merger of two booking sites in a tiny niche market.
11 years
I doubt the EU commission will bother with the merger of two booking sites in a tiny niche market.
Monopolies are illegal in Europe and in the US. I think it's worth writing some letters to ask them to look into it before they approve the deal.
According to this article, the purchase price was US$100million (GBP65million)
11 years
I must admit I am curious; if the need is to 'invest' in the business, why spend $100 million on buying your only real competitor? Why not, oh I dunno, INVEST that $100 million in the business itself?
Am I the only one picturing Alec Baldwin's character from 30 Rock Jack Donaghy rambling on about "synergy" right now?
Oh and the EU wouldn't even bother looking at this. Perhaps a national competition watchdog would take a look but not a supranational one - they have much bigger fish to fry.
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