Online Meeting Vendors Vie In Still Viable Marketplace

Despite the daily reports of Internet bloodletting throughout 2001, online meeting portals and attendee management sites enter 2002 operational and largely optimistic about their chances to win new clients and increase both revenues and their relevance in an industry that absorbed several serious blows last year.

However, not all predictions call for business as usual: Many Internet meeting executives warn that consolidation this year is very likely, as the venture capital pool for such companies has been largely tapped already and, with meeting cutbacks rampant throughout Corporate America, potential revenue streams are less abundant. There have been layoffs, and partnerships have crashed or diminished in relevance. It seems probable that the current competitive landscape won't exist by year-end.

Much like their business models— which, after a lengthy period of sharp changes for some, largely settled in 2001—the companies have different approaches and strategies for the year ahead. Some will focus on research and development, some on attracting new clients, others on servicing existing accounts or developing partnerships with other online travel companies. Some will try to acquire or be acquired, others will scour the industry for additional revenue infusions and others will seek to attain profitability doing what it is they already do.

"Our strategy is that of some technological development, but with a focus on the building blocks of the business," said John Pino, CEO of Philadelphia-based StarCite. "We've resurrected a number of new technological issues that we didn't get done in 2001, but all of us in this e-space will focus on the basics first and not look to be the most spiffy or outrageous. These will be practical advancements."

Practical advancements for StarCite include the development of air booking capability at the point of online attendee registration, Pino said. This would follow in the footsteps of GetThere and SeeUthere and would seem to be a natural for StarCite, given its long-standing partnership with corporate travel booker E-Travel. Pino said such development would include E-Travel and at least one other booking system he would not name. Also, he said, StarCite will focus on upgrading its internal technical supply systems. "We want to ensure our technology is friendly to corporate sourcing options," he said. "Buyers are looking for simplicity and a user-friendly, simplified RFP process, which we're beta testing."

The integration of meetings and travel tools became a hot ticket in 2001, as some corporate travel managers expressed interest in giving their attendees air booking capability under the auspices of corporate travel policy, with its preferred suppliers and restrictions.

There also seems to be potential for deals between global distribution systems, online travel booking systems and meeting management applications, similar to the 2000 hookup of GetThere, AllMeetings and, later, Sabre Inc., sources said, as major GDSs recently have purchased booking systems. Amadeus purchased E-Travel Inc. and Galileo International purchased Highwire, both announced last August. Worldspan also has developed booking capability but has no meeting management capability.

"There will be consolidation and bigger and smaller fish than us involved," predicted John Chang, CEO of Santa Clara, Calif.-based SeeUthere. "We could be a consolidator. Within the next two years, travel and meetings technology will consolidate like other sectors. We view GetThere as our only competitor in the same space as us. Many customers want us to work with GetThere, because they have a piece that customers like. We compete but could be forced to work together."

Officials from GetThere's meetings division, though, said their technological splashes were made in 2001 and that 2002 is a time to introduce their functionalities to the marketplace and shore up existing accounts.

"We introduced so much technology last year that now our focus is on adoption and educating our customer base," said Brian Ashton, president of Henderson, Nev.-based GetThere DirectMeetings. "What we see as interesting is that travel and meetings will work more closely together, and we assume travel has more of a hand in meetings. We'll start to see more meetings departments report to travel. Companies will try to do this, and the rules of both will have to be clarified. For us, that's big."

The year ended with a highlight for Twinsburg, Ohio-based PlanSoft, which signed an agreement to power the search and RFP capabilities for Wyndham International's Web site. Wyndham joined Hilton Hotels as a major hotel chain client for the meeting portal. The company will continue to develop services for those clients in 2002, as well as attract customers to its data consolidating Meeting Management Services application.

"We're moving into bunker mode," said PlanSoft president Ed Tromczynski. "We have more than 2,000 customers, mostly individual hotels, and six big proposals out, so we're trying to conserve our jet fuel."

PlanSoft also is working to close deals with at least one major independent third party that offers meeting management services to corporate clients, not unlike a deal signed with Rosenbluth International in 2000, Tromczynski said. He added that PlanSoft also is close to closing MMS deals with a handful of large companies.

Also, the company is developing interfaces, often upon client request, to integrate or interface MMS tools into financial software or banking applications.

"Our bunker mode means servicing our existing companies. That's probably not the case with the others in this space, those with commission models or transaction fee models," Tromczynski said. "They thought this past fall would be big for them and, obviously, it didn't happen. Corporations have learned to do business differently. It may take another quarter, but hotels will start going bankrupt and meeting companies will go out of business. We'll see how much corporations will learn to live without travel, and whether this year is really bad or just really different."

The potential for 'really bad' happening likely would be due to corporations not pursuing major decisions regarding their corporate meetings departments, be it consolidation, centralization, outsourcing or the introduction of technological tools. The executives largely dismissed this scenario, pointing out that corporate senior management will want to buy travel in more cost-effective manners and layoffs within corporate meetings departments could demand technology to fill the meetings management void.

"Customers are becoming more serious about enterprise solutions and they're realizing that while simplicity and ease of use are important, the power of the offering is key," said Christine Berthet, CEO of Westport, Conn.-based B-there.com. "It's not a concern. On the contrary, first companies cut costs and now they're going to have to begin raising revenues. They must have tradeshows and meetings and meet their customers. Now they have less employees and resources to do so, so they will have to rely on companies like ours. This will happen in six months. We stick closely with our customers, and conduct a fair amount of research and development with them for deep integration, and some of those features developed find their way to market."

"Since Sept. 11, it is clearer than anything in years," StarCite's Pino said. "Buying better is a focus, with more procurement disciplines in the meeting process than ever before. This is a distinct change, made because economic conditions have been put under the spotlight. We're bullish on consolidation, even though it didn't happen as quickly as everyone thought."

There are those that may prefer to delay such decisions, GTDM's Ashton said. "There have been a few potential customers that have said now is not the time, either because there are dramatic, larger cost issues in the corporation or senior management doesn't understand meetings. But the educated know they can't afford not to do it now, because the savings are dramatic."