Hilton Hotels Corp. last week enacted accreditation standards that third-party Internet-based distributors must meet to offer Hilton's merchant inventory. Although the standards went into effect last week, Bala Subramanian, Hilton senior vice president of distribution and brand integration, told BTN non-accredited distributors would have until year-end to meet the standards before Hilton pulls inventory.
"If there are hotels of ours that are distributing through non-accredited distributors, those hotels have to submit and secure a waiver and that waiver will expire by the end of the year," according to Subramanian. "By then, either those companies will ratchet up their agreement with us to become fully accredited, or by the end of the year we would have to pull our hotels off the shelf."
To become accredited, third-party sites must meet Hilton marketing requirements, overcome concerns about trademark use, offer price consistency to Hilton customers and enable "efficient technology to our reservation platform," Subramanian said.
"We want to make sure that distributing products throughout the Internet is efficient for the hotels and doesn't have any hidden costs because it's manual or because it's cumbersome for us to keep up with," Subramanian said. "So, a direct connect would be a requirement."
InterActiveCorp already offers Hilton merchant inventory through its Expedia and Hotels.com brands, which Hilton said already met standards and are fully accredited. Through a two-year agreement, which expired this year, Hilton granted Expedia special access to inventory and Expedia agreed not to offer Hilton rooms at prices that undercut the Hilton's brand sites
(BTN, April 28, 2003). Meanwhile, Hilton has granted Hotwire, Priceline and Travelweb temporary accreditation, as details still need to be worked out, Subramanian said. Yet, two sites that distribute Hilton offerings and also play in the corporate travel marketplace are conspicuously missing from Hilton's list of accredited or partially accredited distributors: Orbitz and Travelocity.
"Travelocity and Travelocity Business have always had the published content from Hilton and we see this as an opportunity to negotiate with Hilton on a merchant deal, if that's something we choose to do," a spokesperson for Travelocity said.
"Our intention is not to pull inventory," Subramanian said. "We are engaging with those companies not on the accredited list so far and having conversations about terms to get full accreditation."
Yet, if Hilton were to decide to pull inventory from certain sites, it would not be the first time in the hotel industry. Intercontinental Hotels Group last August pulled its inventory from Expedia, its business travel arm Expedia Corporate Travel and Hotels.com.
IHG said Expedia as well as Hotels.com had failed to meet certain criteria it established for Web vendors
(BTN, Sept. 6, 2004). The matter remains unresolved.