
Priceline.com acquires Kayak for $1.8B - goatcurious
http://thenextweb.com/insider/2012/11/08/priceline-com-acquiring-travel-company-kayak-for-1-8b-in-cash-and-stocks/?utm_source=Twitter&awesm=tnw.to_isx7&utm_campaign=social%20media&utm_medium=Spreadus
======
casca
Kayak and Hipmunk get a lot of praise for their UI but if you want to use a
hacker interface for finding flights, <http://matrix.itasoftware.com/> is the
way to go.

It's not as pretty, but is incredibly feature-rich, not limited to the US and
regularly finds me prices that are significantly cheaper than anyone else.

~~~
scotth
Have you tried out Google Flights? I've been told it's based on this same
technology, and has a much better UI.

And be sure to click around. It has some interesting tools, like prices for
flights to your destination flown out of nearby airports.

~~~
brianbreslin
wow google flights is super fast!

~~~
edouard1234567
My guess is that they predict the most common searches and constantly query
and cash results for these searches, something I don't think Kayak or hipmunk
does. I don't think you can launch a search product on google if it takes more
than .xx seconds to return the result...

~~~
brianbreslin
I'm not so sure, I looked for a few random flights. However, having built my
own very rudimentary internal flight search tool from the global flight list,
I can tell you there are roughly 7 million flights per month, a small data set
by google standards.

~~~
edouard1234567
It's not the size of the dataset that is relevant but more that this dataset
changes in realtime : price + availability. These requests go through GDSs
that are relatively slow, that's why so called real-time search engines like
kayak are fairly slow. What do you exactly mean by 7M flights? Keep in mind
that most search requests involve a combination of flights (leg), outbound,
inbound and sometime multiple stops...

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smattiso
Relative volatility of KYAK was 3x the normal amount during the day. The news
was released after hours. Long live insider trading!

~~~
nazgulnarsil
Insider trading sends important price signals to the market. The alternative
is LESS information.

~~~
oh_sigh
That's completely idiotic, and I hope you feel ashamed of what you wrote.

The problem isn't more or less information, it's that insider trading creates
two classes of people: Those select few "in the know" who can reap massive
profits by getting an illegal phone call, and the suckers.

~~~
lacker
This ad hominem comment is inappropriate. It is certainly not "completely
idiotic". There is a lot of intelligent discussion on the issue in some
places. For example: <http://www.fff.org/comment/com0306f.asp> .

~~~
Shinkei
This is not an "intelligent discussion." Did you read this article? He sets up
a straw man by comparing specialized knowledge to facts in his first argument.
Everyone can know the odds in Blackjack by card-counting, but no one should
know the next card in the deck. This is a better comparison of insider trading
because using statistics and predictions of market activities based on
'guesses' is perfectly fair, but actually knowing materially negative news
that is confidential puts you at an unfair advantage in a market system. I
mean, how far would you take the argument... so can the CEO sell his shares
before the news? What about the FDA committee chair? How about if a scientist
shorted shares before rendering his judgement that the drug should not be
approved?

Insider trading is just another way for the privileged and wealthy to get
richer and small investors and pensions to get robbed.

~~~
dantheman
You have to ask yourself, what is the point of the market? I'd say to
efficiently allocate resources, in order to do that one should be able to use
any and all knowledge they have available to them -- it allows the market to
find the appropriate price quicker. If small investors and pensions get
"robbed" then they'll adapt or leave the market.

~~~
robryan
Or use whatever advantage you can get to dump the shares in the greater fool.

Having an elite crowd with an unfair advantage is going to make it hard to get
future IPOs or companies issuing more stock to generate much interest in their
offerings.

~~~
nazgulnarsil
So the market will become more conservative in cases with low transparency?
Good.

------
taumeson
Fun fact: Both are located in Norwalk, CT., about a 5-10 minute ride from each
other. Priceline is located almost on the Darien border and Kayak is nestled
in South Norwalk (SoNo). I gotta believe this proximity lead to board member
and executive coziness.

~~~
hluska
I can't escape the feeling that that fun fact is why stories like these have
hit the wires:

<http://zlkdocs.com/KYAK-Info-Request-Form-463>

To save you from reading that document, a law firm has decided to
'investigate' whether Kayak's board "breached their fiduciary duties to
stockholders by failing to adequately shop the Company before entering into
this transaction and whether priceline.com Incorporated is underpaying for
Kayak shares, thus unlawfully harming Kayak stockholders."

Another firm has announced it is conducting another investigation
([http://finance.yahoo.com/news/block-leviton-llp-
investigates...](http://finance.yahoo.com/news/block-leviton-llp-investigates-
kayak-222900689.html)). Not sure if it relates to whether or not Kayak
adequately shopped around the company....

~~~
jarek
Breach of fiduciary duty lawsuits are very common for all major acquisitions.
For the law firm it's high potential reward with relatively little downside.
The mere fact of one or two being filed means pretty much nothing.

------
antoko
Kayak is great (was?) but Hipmunk is more than up to the task of filling the
void if Priceline ruin Kayak.

Congrats to the Kayak folks I guess, when they got into the industry they
really raised the bar.

Before Kayak I remember having to use Expedia and Orbitz and just having to
accept their crappy UI because there simply were no alternatives.

~~~
thezilch
[http://www.google.com/flights/?hl=en&gl=us#search;f=LAX;...](http://www.google.com/flights/?hl=en&gl=us#search;f=LAX;t=SFO;d=2012-11-22;r=2012-11-28;q=lax+to+sfo)

versus

[http://www.hipmunk.com/flights/LAX-to-
SFO#!dates=Nov09,Nov16...](http://www.hipmunk.com/flights/LAX-to-
SFO#!dates=Nov09,Nov16;kind=flight&locations=LAX,SFO&dates=Nov22,Nov28~tab=1)

I respect what Hipmunk is trying to do, but I really doubt they are filling
voids outside of "this" community. I find it much harder to scan, slower to
load, and having lower quality tools for finding alternate (or cheaper) fares.

~~~
TillE
I tried the Google tool...

"Sorry, flights from Germany are not currently supported."

"Sorry, flights from Italy are not currently supported."

"Sorry, flights from United Kingdom are not currently supported."

Wonderful. I can find flights from New York to London, but not vice versa.

~~~
thezilch
It's interesting, considering they will provide round-trip flights and list
the London to NY flight(s) as a separate item, which would make me think the
data is there.

------
photorized
I don't like any of the existing travel sites, so even had to write one for
friends and family (we like pick a random place and just go):

<http://www.somewherenice.net/>

This was put together over several weekends, so don't be too harsh on me. :)

~~~
zalew
I'm working on a travel (many)weekend(s) project myself yet to launch, so I
won't be too harsh, but... :P I put Warsaw in, and the suggested airports were
Okecie (correct) and Babice (it's in Krakow), Modlin was missing. And all the
result were in the USA. I like the design theme with all the backgrounds etc.
and the logo, cool idea. You should leave some way to contact you with
feedback on the page. Keep on, good luck.

~~~
photorized
zalew: airports - the UI lets you add your own. But I will look into Warsaw...
I am currently looking at airports within a 50 mile circle, is Modlin farther
than that?

About the results: if there's no snow, a ski resort will most likely not be
shown to you.

The destinations were hand-picked, e.g. 2012 Best All-terrain, or best night
life, or... But the list is growing, we just started to add European
locations.

~~~
zalew
<http://goo.gl/maps/hWc9q> Modlin is a recently opened low cost airport, a few
months ago. maybe your data source is not current.

oh, hand picked, I get it. I thought they were scrapped but maybe capped for
US-only.

------
dude_abides
Just 4 months after IPOing and right after reporting record earnings! It looks
like they perfectly timed it right at their peak.

------
daakus
I hope this doesn't kill the current best UX that hides the junk in this
industry.

~~~
duck
There is always <http://hipmunk.com>, which I think has the best UX of any of
them (although maybe it is lacking some features, but none I would use
anyhow).

 _Edit: Doh, fixed the link!_

~~~
bradleyjg
I agree their UI is somewhat nicer, but they don't have all the features. In
particular they don't have one way.

~~~
newhouseb
They do, you just leave the return date blank.

~~~
jonknee
Not great UX on a site priding themselves on UI.

------
FaceKicker
Pretty tangential, but why is it that none of the flight search engines
include Southwest? I realize that Southwest doesn't give their fare info to
whoever the other airlines give it to, but what's stopping someone from just
scraping southwest.com every hour or so for the current fares? Or even if
scraping is against their TOS, couldn't they hire one data entry employee to
manually go through and add Southwest's flights every day? Or is it somehow
_illegal_ to publish Southwest's prices?

I imagine it would be a big competitive advantage for whichever one did it
first - it's pretty annoying how every time I want to search for flights I
have to first search on Kayak/Hipmunk/GoogleFlightSearch and then separately
go to southwest.com and wade through their slow, awful search interface.

~~~
calbear81
Southwest does not believe in distributing their fares through the metasearch
or OTA channel. They want to own the customer and make sure there's only one
destination to book Southwest fares and that is Southwest.com and it's worked
out pretty well for them.

The hard part for scraping is that it's both against their TOS and you
wouldn't be able to have accurate availability and price information through
manual data entry. The nature of how frequent price changes and the number of
possible combinations of fare types/routes/availability is what gave rise to
companies like ITA.

~~~
FaceKicker
> The hard part for scraping is that it's both against their TOS and you
> wouldn't be able to have accurate availability and price information through
> manual data entry. The nature of how frequent price changes and the number
> of possible combinations of fare types/routes/availability is what gave rise
> to companies like ITA.

Anecdotally, whenever I've checked Southwest prices multiple days in a row
they usually stay the same. So I'd imagine it would still be a valuable enough
resource if there were someone who did this manually at the granularity of a
day, even if when you clicked through to buy the tickets they occasionally
wouldn't match the price the search engine told you. You could even have a
"report this price as incorrect" button.

~~~
bradleyland
Yes, but if you're a website serving millions of customers per day, you need a
contractual arrangement to A) have up to the moment pricing, and B) agreement
that the airline will honor the prices published on your site.

Because airfare prices follow an upward trend as flight time approaches
(although they sometimes taper as the flight date gets really close), you'd
inevitably publish prices that are out of date and lower than the actual fare.
This is unavoidable because you're relying on scraping, which involves
polling, in which there is always a delay due to polling intervals. You'd
stand to lose millions of dollars every time a price increase occurred between
the time that a customer decides to book a ticket at one price, and the time
your polling system picks up the increase.

Circumventing Southwest's desire to avoid this channel is not a good business
model.

------
personlurking
Anyone have any idea if Kayak will be integrated into Priceline or if it will
remain its own company?

~~~
colinsidoti
It's own company: [http://www.tnooz.com/2012/11/08/news/priceline-buys-kayak-
fo...](http://www.tnooz.com/2012/11/08/news/priceline-buys-kayak-
for-1-8-billion/)

------
_casperc
This may not be the place or time to ask this but here goes anyway:

How do the travel indexing sites like Kayak get their data? Surely they don't
index or consume APIs from the travel companies individually?

~~~
tonystubblebine
A company called ITA, now owned by Google.
[http://www.fastcompany.com/1666092/google-acquires-
airline-d...](http://www.fastcompany.com/1666092/google-acquires-airline-data-
company-ita-get-ready-google-flight-planner)

~~~
baltcode
And where does ITA get it's data. I assume there must be a few competing
standards, and the airlines use one of them to give their data to ITA. Why
can't other companies get the data directly from the airlines?

~~~
calbear81
ITA get its data from ATPCO (<http://www.atpco.net/atpco/aboutatp.shtml>) the
clearinghouse for flight data.

------
smackfu
From the Kayak IPO S-1:

In particular, for the nine months ended September 30, 2010, Expedia and its
affiliates, including its Hotels.com and Hotwire subsidiaries, accounted for
25% of our total revenues. Also during this period, Orbitz and its affiliates,
including its CheapTickets and ebookers subsidiaries, accounted for 19% of our
total revenues.

I guess Priceline wants to get a first shot at all that business, and then to
get paid by their competitors for bookings they don't get.

~~~
photorized
I am curious what their contracts with all these parties looked like...
Booking providers seem to like exclusivity.

Btw, anyone from Travelocity here? Would love to share some feedback about
your platform.

~~~
arbuge
Related: Expedia has an API... <http://developer.ean.com/>. Haven't checked it
in a while - looks like only hotels are available now (no flights, cars,
cruises, etc.)

Of course, not saying that Kayak went through this route - this is just
something available to the hoi polloi.

~~~
photorized
I looked at Expedia for somewherenice.net, and didn't choose them for that
reason. Needed to be able to package the whole trip, from airfare to lift
tickets, so ended up working with Travelocity.

------
colinsidoti
In recent times, Kayak has been shifting to push customers directly to
airlines and hotels, instead of pushing them through online travel agencies
like Priceline.

I suspect this is Priceline admitting that it (and other OTAs) are losing
relevance in preference for the meta-search model.

Smart move, and I don't think they're dumb enough to ruin it. Read up on how
successful Priceline was with their Booking.com acquisition.

~~~
colinsidoti
Also, I wouldn't be surprised if we see another OTA scoop up Hipmunk soon
while it's (relatively) cheap.

------
riviera
Sad day today. I hope they don't touch it!

~~~
donretag
You mean by having Captain Kirk do commercials for them?

------
dbecker
I'm not remotely worried about priceline ruining kayak.

Kayak was the best interface before hipmunk, and it may (or may not be) the
best interface now.

But there will be more improvements in travel buying interfaces... whether
those improvements come from kayak or someone else, Kayak's current interface
will seem kludgy in a couple years.

------
edouard1234567
That's really bad news for Expedia. When you book a hotel room directly on
Kayak, over 90% of the bookings go through expedia and hotels is where these
travel agencies make most of their money. (Not airfares, they have become a
commodity, thanks to Kayak :) )

------
gordonbowman
I think this is a great acquisition by Priceline. They are going for market
share here to get ahead of Expedia et al.

A big part of their growing business is in Europe via Booking.com, so with
Kayak they beef up their market share here in the U.S. in a big way.

------
yawgmoth
Since everyone seems to be putting in their 0.02$ on which sites they use for
booking, bing.com/travel is also very good. The buy-wait prediction is
fantastic.

~~~
calbear81
It's good to see people still using Farecast! Most of the original team is now
working on other startups including Decide.com, Medify.com, and Room77.com.

------
antonpug
Great. Now Kayak will become a hell of a lot more "biased". Priceline does not
give nearly as good of results as Kayak.

------
fouadz
Anyone can explain me where they get all the deal ?

------
d23
The title looks like it reads $1.88. I thought they had pulled some legal
gimmick to screw them over.

