It seems as if the wind beneath AOL's wings isn't just hot gas. Time Warner's (NYSE:TWX) challenged online service is gearing up to launch on online travel portal next year. But has the train left the station? Has the boat sailed out of the harbor? Has the plane lifted off the tarmac?
Oh, right, the plane's still there. Those amazing flying machines have a way of never leaving on time, huh? But fighting my way back through all of the metaphorical cliches, I still have to wonder why AOL is teaming up with Kayak Software to launch a travel comparison site.
InterActiveCorp's (NASDAQ:IACI) Expedia and Sabre's (NYSE:TSG) Travelocity have been at it for years, and Orbitz, acquired just this month by Cendant Corp. (NYSE:CD), followed shortly thereafter. If you enjoy a wrinkle in the model, companies like Hotwire and mystery discounter Priceline.com (NASDAQ:PCLN) have sprinkled up the vanilla with their own eclectic offerings, while perpetually overpriced Travelzoo (NASDAQ:TZOO) has the discount missives down to a science. While the beta-testing Kayak.com site claims that it will scour dozens of sites to provide the most attractive rates, there are already plenty of programs like TravelAxe doing the metasearch thing.
As good as AOL's product may be when it debuts come 2005, it's already a crowded sector and it's hard to think of the exact void that Time Warner is looking to fill with its subsidiary's move. If anything it may compromise the advertising dollars and affiliate relationships that AOL has developed in this arena over the years as it pits sponsor against sponsor in the metasearch results.
What is probably even more alarming is that it's not limiting this service to its subscribers. It's part of AOL's new strategy to provide services to the entire Internet. So it's not as if this will be some sticky incentive for subscribers to stick with the company.
Tomorrow I'll be following up last week's When AOL Was a Rule Breaker column with a more upbeat plan on what AOL can do to save itself. And maybe I'll change my mind when I see the finished online travel service firsthand. Until then, it seems as if AOL is just buying a ticket to nowhere.
Will AOL really sway you from your own online travel site preferences? Where do you go to find the cheapest flights? All this and more -- in the Cheap Air Fares discussion board. Only on Fool.com.
Longtime Fool contributor Rick Munarriz loves to travel and has been booking his travel online since the 1990s. He is also part of the Rule Breakers newsletter research team and he does not own shares in any of the companies mentioned in this story.
