ON-LINE travel companies received some good news last week after BT announced plans to cut telephone rates for Internet users.
At present, users pay varying rates depending on the day and time they are on-line, and it is widely believed that confusion and fear of high telephone charges is limiting Internet use.
In the UK, users spend an average of 17mins a day on-line, compared to nearly an hour in the US, where local calls are free in many regions.
The received wisdom is that if a cheaper, flat-rate price system can be established in the UK, there will be an explosion in Internet shopping. On-line travel agents, which have become major e-commerce players in a relatively short space of time, would be sure to benefit.
Expedia UK manager James Vaile welcomed the BT announcement, saying: “Travel is one of the top three categories that people look at on-line. As it’s such an emotional product, unlike a book or CD, you have to do a lot of research to identify a destination, product and price. It all takes time.”
Paul Richer, the senior partner at travel technology consultancy Genesys, said: “It has already been proven in the US that the lower the dial-up charge, the more people will use the Internet. This is great news for travel companies that offer services on the Web.”
A BT spokeswoman said the decision to look at cutting rates was prompted by its interest in supporting the UK’s growinge-commerce sector.
However, she warned that reducing charges was not a straightforward matter, because agreement would have to be reached with competitors in the telecom industry. BT’s infrastructure is used by all telephone users regardless of what company they are signed up to, unless they are connected via a cable service.
“We are in discussions with the rest of the industry at alllevels to work through what is a very complex area,” she said. “It may be possible to introduce pricing which is aimed specifically at Internet users.”
Any new pricing system is not expected to be introduced before next year. But in the meantime, on-line travel operators will be gauging the impact of Internet service provider America Online’s recent move to create a cheaper, simpler pricing structure for its 600,000 UK members.
Light users, who pay £4.95 a month to spend 3hrs on the Internet, now don’t pay any telephone charges at all.
For £9.99 a month, users get unlimited Internet access for a call cost of 1p a minute at any time.
Internet service provider AOL UK, which has just relaunched its travel site (see below), claims on-line travel booking has been one of e-commerce’s early success stories.
UK channel director for travel and shopping, Caroline Chapple, said: “People are happy to book travel on-line. I think it is because they are already happy to buy on the telephone or through Teletext.”
Certainly, as the number of people with Internet access continues to grow, so will the amount of travel booked on-line.
Independent Internet research company Fletcher Research estimates that the number of UK Internet users will rise from 15.7m in 1999 to 24.5m by 2003. The latter figure represents 52% of the UK’s population.
Fletcher also predicts that the on-line flight booking sector will double in value from £44m in 1999 to £90m in 2000. By 2003, it could be worth £489m.
AOLUK has revamped its travel content to offer a new booking centre and high-speed search facilities for destination information.
The booking centre has sections on special bargains, flights, hotels, car hire and insurance. AOL UK’s travel partners include Thomas Cook – which offers an e-mail booking service – and on-line companies Expedia and lastminute.com.
A new travel resources section now has dedicated search facilities for visas, health, Foreign Office advice, duty-free limits, public holidays and weather. And a third section named Inspiration is given over to users, who can post travel reports and discuss any of their travel experiences on-line.
Meanwhile, the company has signed up TV presenter Alan Whicker to front its travel channel. Future items will include Whicker’s Top Choices, Ask the Expert, and a live on-line interview with Whicker. Other editorial contributors to the site include guide book company Lonely Planet and Columbus Travel.
AOL UK’s travel channel is only available to its 600,000 UK members.