Expedia/HomeAway is just one of three giant deals in accommodation in 2015 — the others being Marriott/Starwood and Accor/Fairmont/Raffles/Swissotel. While all are important, it’s not necessarily for the reasons many assume.
First, the deals signify that the distinction between hotels, timeshares, vacation rentals, etc. are false constructs. All of these are just accommodation or lodging or whatever label you choose to put on it as a category. At their essence they are places where you can sleep when you are not at home.
As OTAs, hotel groups, alternative accommodation giants, and other players come realize this, they will consolidate and converge.
Secondly, these deals are significant because of their size: $2.9 billion for the Accor deal, $3.9 billion for HomeAway, and $12.2 billion for Starwood. These seem like monstrous sums, and yet compared to Airbnb’s latest $25.5 billion valuation, they are peanuts.
This demonstrates that we are in the midst of tremendous change in terms of what “accommodation” and even “travel” looks like.
Sure, there is a marked difference between public and private markets, but something is only worth what someone else is willing to pay for it. Thus, by definition there are individuals and institutions willing to pay MUCH more for a share of Airbnb than they are for any of these other brands.
It is the last deal of the year, Accor, that demonstrates a third point: the incredibly global nature of the space. Travel by definition has a broad geographic scope, but many of the big brands garnering attention to date have been US-based.
The Accor deal, where a French company bought from two Middle Eastern funds, also demonstrates the US has no monopoly when it comes to consolidation or success in travel. The US may have a lead, but the rest of the world is fast catching up.
All of this leads to the fourth and final point: the future will NOT look like today.
Yes, there is convergence occurring across categories. Yes, there is consolidation within and across categories and geographies.
But there is also a tremendous consumer-driven change taking place in how people discover, book, and ultimately travel. Airbnb and Uber have been the poster children for this change. They have changed expectations. They have changed experiences. And ultimately, they are changing entire industries.
This convergence will lead to huge players, who may look the same, but only in the sense that they all will have to stop being the same. To survive they must continually strive to provide unique offerings and authentic experiences.