Hotel Online  Special Report

Orbitz and Travelweb Settle Dispute
Travelweb Remains Exclusive Third-party Provider of Inventory on Orbitz
from Hilton, Hyatt, Marriott, InterContinental and Starwood


CHICAGO and DALLAS, May 3, 2004 - Orbitz (Nasdaq: ORBZ) and Travelweb LLC today announced they have settled their dispute, agreeing that Travelweb will remain the exclusive third-party provider of merchant hotel inventory on Orbitz from leading hotel brands Hilton, Hyatt, Marriott, InterContinental and Starwood hotels.  The agreement ends the current litigation between the two companies.

The agreement provides Orbitz with complete flexibility to market hotel inventory in a manner that best meets consumers' needs.  It assures Orbitz of an adequate supply of merchant inventory from the major brand-name chains and gives the site flexibility to work directly with other chain and independent hotels to continue the growth of the Orbitz Merchant Hotel program.  Orbitz agreed to display on its site the hotel inventory provided by Travelweb founding hotel chains.  Travelweb agrees to pay Orbitz higher commissions in return for a minimum room night commitment.  In addition, Orbitz agreed to a one-time waiver of the right to terminate the contract if Travelweb experiences a change in ownership.  The agreement expires in December 2005.  Other terms were not disclosed.

"Our relationship with Travelweb has helped us grow our merchant hotel business very quickly.  This settlement allows us the flexibility we need to continue our growth yet provides Travelweb with a continued revenue stream from Orbitz," said Jeff Katz, Orbitz president and chief executive officer.  "As demand for hotel inventory grows due to the strengthening economy, we believe that this agreement and the access to the major brands' merchant inventory it provides will be important to our success.  This benefits customers because it enables Orbitz to continue displaying attractive OrbitzSaver(TM) rates from a comprehensive selection of more than 14,000 hotel properties.  And it benefits independent and other chain hotels that would like to work with Orbitz directly in merchandising their properties to our fast-growing customer base."

"We value our distribution relationship with Orbitz and are glad to see it continue to the benefit of both companies," said Jaynne Allison, chief operating officer and general counsel for Travelweb LLC.  "Travelweb's seamless distribution network provides leading Internet retailers, like Orbitz, with access to great deals from the world's leading hotel chains in the top destinations worldwide.  Orbitz' popularity with consumers will generate the booking volume that all of our participating hotels deserve."

Orbitz is a leading online travel company that enables travelers to search for and purchase a broad array of travel products, including airline tickets, lodging, rental cars, cruises and vacation packages.  Since launching its website to the general public in June 2001, Orbitz has become the third largest online travel site based on gross travel bookings. 

Travelweb LLC is a travel distribution company. Owned by Hilton Hotels Corporation (NYSE: HLT), Hyatt Corporation, Marriott International (NYSE: MAR), InterContinental Hotels Group (NYSE: IHG), Starwood Hotels (NYSE: HOT), (Nasdaq: PCLN) and travel technology provider Pegasus Solutions, Inc. (Nasdaq: PEGS), Travelweb pioneered the seamless merchant distribution model which is credited for returning yield and revenue management capabilities back to hoteliers and for broadening their distribution options. 




Also See: HSMAI Hotel Internet Marketing Strategy Conference Report; Keyword Bidding, Pop Ups, Pop Unders, Domain Name Piracy / January 2004
After Much Controversy, the Internet Travel Site Orbitz is Launched / June 2001

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