As generative AI reshapes how consumers search for trips, established OTAs like Expedia are leveraging their greatest asset—data—to stay ahead of the curve.
The travel industry is witnessing a new competitive front: the standoff between traditional Online Travel Agencies (OTAs) like Expedia and the rapid rise of Large Language Models (LLMs) like ChatGPT. While AI promises to revolutionize travel planning, industry leaders argue that established players hold a distinct advantage when it comes to reliability and execution.
The Trust Gap: Inspiration vs. Transaction
While tools like ChatGPT excel at providing inspiration—drafting itineraries or suggesting destinations—they currently struggle with the precision required for booking. A significant hurdle for standalone AI models is the issue of “hallucinations,” where the AI confidently presents incorrect information.
Expedia Group’s CEO, Ariane Gorin, has highlighted this distinction, noting that while GenAI is a powerful tool for discovery, it lacks the real-time accuracy needed to handle complex logistics like flight connections, hotel availability, and pricing.
The “Data Moat”
The core of Expedia’s defense—and its competitive edge—lies in its massive repository of proprietary data. Unlike generalist AI models, Expedia feeds its AI tools with decades of transaction history, real-time inventory, and verified customer reviews.
This integration allows Expedia to offer what ChatGPT currently cannot:
- Actionable Bookings: Turning a search query directly into a confirmed reservation.
- Service Reliability: Leveraging established customer service infrastructure to handle disruptions.
- Personalization: Using past user behavior to tailor results more accurately than a blank-slate AI.
Collaboration Over Destruction
Rather than viewing GenAI purely as an existential threat, Expedia has moved to integrate the technology. By embedding ChatGPT features directly into its app, Expedia aims to combine the conversational ease of an LLM with its robust booking engine. This hybrid approach suggests the future of travel tech isn’t “AI vs. OTA,” but rather a convergence of the two.
The Road Ahead
The consensus among industry analysts is that while GenAI will change how people search for travel, the booking layer will remain dominated by companies that own the supply chain and inventory. However, the pressure is on: as AI models improve their accuracy and ability to interact with external APIs, the gap between “chatting” about a trip and “booking” one will narrow, forcing incumbents to innovate faster than ever.
