The US Department of Justice has concluded that
airline-backed travel site Orbitz has not violated antitrust
laws.
After an extensive investigation, the DoJ had concluded that
the joint venture has not reduced airline competition or harmed
consumers.
"The Division considered several theories of harm, none of which
was ultimately borne out by the information collected by the
Antitrust Division," R Hewitt Pate, assistant attorney general in
charge of the Antitrust Division, said.
"These concerns included whether certain Orbitz contract terms
would facilitate co-ordination among the participating airlines or
reduce their incentives to discount, resulting in higher fares, and
whether those contract terms would make the Orbitz joint venture
dominant in online air travel distribution."
The DoJ determined that those terms did not result in higher
fares or make Orbitz dominant in the industry.
Jeff Katz, president and chief executive officer of Orbitz, said
the DoJ decision was the clearest and most important statement
affirming that Orbitz had increased and energised competition in
the online travel marketplace.
"Previously, the Department of Transportation inspector general
found no evidence of any anticompetitive behaviour by Orbitz and,
in fact, determined that Orbitz provides a valuable service to
consumers and promotes competition in the travel market," he
added.
The DoJ's investigation began before Orbitz was even launched in
June 2001. Critics, including online travel sites Expedia.com and
Travelocity.com, complained that Orbitz's relationship with the
airlines gave it an unfair advantage and would be bad for
consumers.
Orbitz is owned by American Airlines, United Air Lines,
Continental Airlines, Delta Air Lines and Northwest Airlines.
Linda Rosencrance writes for Computerworld