Los Angeles Times - 27.08.2019

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C6 TUESDAY, AUGUST 27, 2019 LATIMES.COM/BUSINESS


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suits against Marriott Inter-
national and Hilton World-
wide Holdings, respectively,
calling the fees deceptive.
Although Booking.com
concedes that the move will
generate extra revenue for
the company, the travel site
contends that the change
primarily is intended to
push hotels and other lodg-
ing providers to be more
transparent about the total
cost they plan to charge po-
tential customers.
“We believe in complete
transparency and that the
best customer experience is
when people know the entire
cost upfront,” company
spokeswoman Angela Cavis
said. “Hopefully this will
help continue to push the
entire industry toward more
transparency and fewer sur-
prises for customers.”
Hotel industry leaders
say only a small percentage
of hotels charge mandatory
resort fees and most of them
clearly disclose the charges
before rooms are booked.
“When guests choose a
property with a resort or
amenities fee, hotels are
careful to follow [Federal
Trade Commission] guid-
ance and display fees prior
to the end of the booking
process,” said Rosanna Mai-
etta, executive vice presi-
dent of communications for
the American Hotel & Lodg-
ing Assn. A 2018 report by the
trade group found 6% of ho-
tels surveyed charge a resort
fee.
Hotels charge resort fees
with the justification that
they cover the use of such
amenities as swimming
pools, gyms and business
centers, among other facili-
ties and services. But in the
last few years, more hotels
and resorts have made re-
sort fees mandatory, charg-
ing as much as $100 a night,
even at properties that don’t
offer extras such as a pool or
a gym.
Often the extra fees are
called “facility charges,”


“destination fees” or “ameni-
ty fees.”
In addition to raising ex-
tra revenue, the mandatory
resort fees allow hotels to ad-
vertise nightly room rates
that appear to be much
lower than they actually are
when the fee is added. It
means that travel booking
sites that list hotels by order
of lowest to highest price
may give consumers the
false impression that a hotel
is much cheaper than it is
with the mandatory fee.
The FTC issued a warn-
ing to 22 hotels in 2012, say-
ing that surprising guests
with hidden resort fees is de-
ceptive and illegal. In re-
sponse, the hotels began to
list their resort fees on their
booking websites — but
often only in small print and
late in the booking process,

just before the guest is ready
to pay.
In the U.S., hotels gener-
ated nearly $3 billion in 2018
in mandatory hotel fees, ac-
cording to an estimate by
Bjorn Hanson, an adjunct
professor at New York Uni-
versity’s Jonathan M. Tisch
Center for Hospitality and
Tourism. The total repre-
sents an 8.5% increase from
2017, and Hanson predicts
such charges will continue to
rise in 2019 as hotels try to
combat increasing payroll
and real estate costs.
Resort fees generally run
between $20 and $40 a night,
although in Las Vegas,
where such fees are com-
mon, three high-end MGM
Resorts properties just
boosted the nightly resort
charge to $45 from $39, a 15%
increase.

Booking.com is the most
popular of the online travel
sites operated by Booking
Holdings, a Norwalk, Conn.,
company that also owns
Priceline, Kayak, Agoda and
other travel-related sites.
Company representatives
say they are considering
charging a commission on
resort fees in the future at
the other Booking Holdings
brands.
Travel rights organiza-
tions are pushing to have all
hotels include mandatory
fees in the advertised rate so
that price-shopping con-
sumers know what they will
ultimately pay to book a
room.
Charles Leocha, presi-
dent of the advocacy group
Travelers United, ap-
plauded the move by Book-
ing.com and said he hopes

more travel websites put
pressure on hotels to include
the mandatory fees in their
advertised rate.
“It is a move by the larg-
est hotel OTA [online travel
agency] to strike at resort
fees and take away part of
the profit that hotels are
making now without any
commissions,” he said.
Expedia, another large
online travel agency, is tak-
ing a different approach
from the Booking.com mod-
el of charging a commission
on resort fees.
Hotels that charge resort
fees will be downgraded
when the site sorts available
rooms from lowest to high-
est price, Expedia Lodging
Partners Services President
Cyril Ranque recently told
reporters for the travel site
Skift.

That means that hotels
charging resort fees won’t be
able to use a pre-fee base
rate to give an impression of
the final hotel rate.
“We believe travelers ben-
efit when they have access to
a wide variety of travel op-
tions and transparency on
what they pay for hotel
stays, including hotel-im-
posed mandatory fees,” the
company said in a state-
ment. “We continue to work
with our hotel partners to
make sure the fees they
charge are shared with us so
we can in turn clearly display
them, enabling travelers to
make informed decisions in
their hotel selection proc-
ess.”
The hotel industry fired
back at the travel sites, say-
ing they aren’t always trans-
parent about the fees they
charge customers.
“Historically, the FTC
has received a significant
number of complaints from
consumers who booked
travel through third-party
websites, and then were
charged additional fees that
were not disclosed at the
time of booking,” Maietta
said.
Among the most popular
travel sites are so-called ag-
gregator sites such as Kayak
and Trivago, which compile
a list of travel rates from var-
ious other booking sites.
They make profits from ad-
vertising, not from hotel
booking commissions.
TripAdvisor, a site that
does not collect a commis-
sion but instead directs
users to hotel websites, said
that it “believes in pricing
transparency” but does not
plan on making any changes
to the way it advertises hotel
rates.
“If the broader travel in-
dustry displays these resort
fees in their initial pricing
displays and supplier part-
ners provide us and other
distribution channels with
this data, we would also
show it as well,” the com-
pany said in a statement.

Travel websites take on hidden resort fees


TOURISTSwatch the water show at the Bellagio in Las Vegas. The Bellagio and other hotels that charge
guests a fee in addition to a room rate are getting pushback from some travel groups and from Booking.com.

Kent NishimuraLos Angeles Times

[Resort fees,from C1]

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