Spain Watchdog Fines Booking.com Nearly $450 Million For Abusing Its Dominant Position (euractiv.com) 20
Spain's competition watchdog said Tuesday it had slapped online travel agency Booking.com with a record $446.7 million fine for "abusing its dominant position" during the past five years. From a report: "These practices have affected hotels located in Spain and other online travel agencies that compete with the platform. Its terms and conditions create an inequitable imbalance in the commercial relationship with hotels located in Spain," the CNMC said in a statement. "By better positioning hotels with more bookings on Booking.com, other online agencies have been prevented from entering the market or expanding," it added.
This is the largest fine ever imposed by the CNMC, a spokeswoman for the authority told AFP. The CNMC said Booking.com's market share in Spain, the world's second most visited country after France, during the period under investigation was between 70 percent and 90 percent. Booking.com, whose parent company Booking Holdings is headquartered in the United States, is a dominant player with a market share in Europe of more than 60 percent. In May, the European Union added the travel agency to its list of digital companies big enough to fall under tougher competition rules, giving the firm six months to prepare for compliance with the landmark Digital Markets Act (DMA).
This is the largest fine ever imposed by the CNMC, a spokeswoman for the authority told AFP. The CNMC said Booking.com's market share in Spain, the world's second most visited country after France, during the period under investigation was between 70 percent and 90 percent. Booking.com, whose parent company Booking Holdings is headquartered in the United States, is a dominant player with a market share in Europe of more than 60 percent. In May, the European Union added the travel agency to its list of digital companies big enough to fall under tougher competition rules, giving the firm six months to prepare for compliance with the landmark Digital Markets Act (DMA).
Re:Uh hmmm (Score:5, Informative)
It is not about final customers, it is about other agencies. Apparently agencies trying to enter the hotel booking market notice that hotels won't want to work with them, even if they compete favourably on website/app features and price (invoiced to the hotels for the service). The reason is Booking.com displays first hotels that have placed their entire room "fleet" in booking.com. This can be read as: booking.com punishes hotels that work with other agencies. Exclusivity contracts (which are a market distortion, whether it's legal or not) are ok for small companies, but when in dominant position, they are considered a market distortion, and they easily lead to monopoly situations.
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Ah, thanks for explanation.
My question would be, "how did booking.com take over the market?" Did they earn that position by being better or through scammy shit?
How did they behave when they had 5% of the market?
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They had 5% of the market back in the 1990s when most people were booking offline.
Re: Uh hmmm (Score:2)
This question might be interesting for you, but I am not certain that it is relevant to the decision to fine them: they are now in a position to distort the market, and they have been caught doing that, so they have to pay for it.
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In the US it matters how a company became a monopoly. If it doesn't in EU then so be it. Since you're is there an appeals process or have they already?
Re: Uh hmmm (Score:2)
I have no idea, it's just what the text says. I imagine Spain had its own laws, plus local laws too.
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The issue is that the hotels would like to advertise on other platforms that have a lower commission rate, and pass those savings onto you. But Booking.com prevents them from doing that.
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It is a real problem.
At the moments it is more like a duopoly.
Expedia Group: Expedia, Hotels.com, Hotwire, Trivago, Orbitz, Venere
Booking Holdings: Booking.com, Kayak, Agoda, Rentalcars.com, Momondo
Those aren't even all their subsidiaries. They also run OEM search engines that various smaller companies use.
A friend ran an apartment hotel and he cursed them all to hell and back. The first time he told me about expedia fees it was in the order of 40%. I see a website now lists it as up to 25%, but I guess the
Bloody EU fining damn Americans again (Score:3, Insightful)
How dare they! They can never create anything themselves so they just attack good ol' American companies. Winners win, losers litigate.
Sorry what?
Founded in Enschede you say? Dutch company? No that can't be right! Europe against America! The Narrative (tm)! OH THE NARRATIVE (TM)! WHYYYY!
Re:Bloody EU fining damn Americans again (Score:4, Interesting)
& unlike the USA, which appears to have given up on the idea, EU countries still somewhat regard themselves as social democracies, governed for he benefit of the citizenry... some more than others, obviously.
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Lesson: Tourism makes up ~15% of Spain's economy. Did Booking.com really think the EU & Spanish govt would sit back & let them siphon off the profits? Don't fuck with EU countries' livelihoods.
& unlike the USA, which appears to have given up on the idea, EU countries still somewhat regard themselves as social democracies, governed for he benefit of the citizenry... some more than others, obviously.
It's less about the profits, more about breaking the law. Spain is very much a capitalist country, profit isn't bad there however flagrant disregard of the law isn't tolerated.
Booking.com owns most of the major travel websites in Europe, Expedia, their main rival in the US hasn't got so much of the market outside the US. So they're very much a monopoly in Europe. Meaning they'd still be making money hand over fist even without abusing their dominant market position.
Also this is another reason I prefer
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booking.com is a EU company, founded and headquartered in the Netherlands https://en.wikipedia.org/wiki/... [wikipedia.org] That a US group later acquired it does not change that it is understood as European. Same way Chrysler is understood as a US maker headquartered in Detroit, even though it currently belongs to Stellantis (essentially Peugeot & Fiat)
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Booking.whatever has always been a trash fire. As a student I earned some money in the early 2000s by scraping content from hotel websites and entering them into the booking.whatever system. I did that for about two weeks, it was unethical, and it paid shit. They had a whole army of people doing that.
How do you abuse a dominant position? (Score:1)
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These kinds of clauses should be outright illegal (Score:2)
It should be illegal for a marketplace (be it booking.com, Amazon, food delivery or anyone else) to include a clause in their contract with those who sell in that marketplace that says "you can't sell the same thing elsewhere for cheaper than you sell it here".
Re: These kinds of clauses should be outright ille (Score:3)
Agreed. But also, the whole point of these marketplaces is to become so prevalent that they are, in essence, a tax on certain transactions. Wanna offer hotel rooms? Pay the booking.com tax (or go out of business). So the whole point of these businesses is rotten, they are parasitic in nature. Whatever we make illegal, it should make this business model unviable.