Travel agencies are a hard way to make money because the airlines now have incentives to play hardball and drive traffic to themselves or cut commissions to the bone. It's hard to see how Orbitz can make money long when they have a non-differentiated product, where the suppliers, IE the airlines are consolidating. Using the standard five force Porter analysis, we see an industry characterized by powerful suppliers, commodity products, intense competition, and low barriers to entry. Hard to see how this is an industry worth investing in.
No comments:
Post a Comment