DOT: Orbitz not anticompetitive

By John Hughes
Bloomberg News Service

WASHINGTON — Orbitz Inc., the Web-based travel seller owned by the five largest U.S. airlines, doesn't have an unfair advantage over rivals such as Expedia Inc., a DOT study concluded.

The company's practice of requiring participating carriers to post the same fares on Orbitz's Web site that are available on any other Internet locations in order to get a rebate on booking fees hasn't resulted in monopolistic or anticompetitive behavior, according to a government report obtained by Bloomberg News.

"Orbitz has not accumulated sufficient market share to control the online distribution market," the report by the U.S. Department of Transportation's inspector general said.

The ability to gain market share is limited by factors such as Orbitz's ticketing fees and the fact that some airlines have decided not to work with the company, the report said.

AMR Corp.'s American Airlines, UAL Corp.'s United Airlines, Delta Air Lines Inc., Northwest Airlines Corp. and Continental Airlines Inc. have invested $204.8 million in Orbitz since it was founded in February 2000 as a way to reduce ticket-distribution costs.

Orbitz last May filed for a $125 million initial stock sale to help run the business and expand offerings.

The DOT report also concluded that an initial public offering for Orbitz would not remove the need for government oversight.