Why AI agents will supercharge, not bypass, OTAs

The expected rise of AI agents in 2025 has sparked a feverish narrative in travel tech circles: travel distribution will be democratized, bypassing online travel agencies and ushering travel in a golden age of direct supplier-consumer relationships.

The commonly accepted narrative is that the personal AI agents promise to cut through the complexity of travel planning like a hot knife through butter, connecting directly with supplier websites and APIs to create the perfect itinerary.

As Magpie founder Christian Watts recently explained in his opinion piece: “The AI doesn’t see marketing messages and persuasion taglines. It doesn’t care about the nice rounded blue button, with “buy now” in a special font that has been split tested over 20 years. It doesn’t even notice the slick new $2 million logo.”

Enough to make any OTA executive lose sleep, right? Not yet. 

Here's my contrarian take: The reality unfolding before us is a tale of how technological evolution often strengthens rather than weakens established market structures, especially when those incumbents have spent decades building the financial models and tech foundations that the new platform shift will need to thrive.

The rulers of the AI agentic world - and who pays the bill?

2025 promises to be a fascinating year in "the Great AI Land Grab" story, where every tech giant is staking their claim in this new frontier. 

Google's CEO Sundar Pichai announced its Gemini powered vision for a "universal agent that will be useful in everyday life," Microsoft is aggressively weaving its Copilot AI into every corner of our digital lives and unveiled Magnetic one, its own web AI assistant, while dropping $13 billion into OpenAI. Meta is busy integrating its frontier model across its three billion monthly active users while pushing its smart glasses for an AI-first world, Amazon is combining its dominant AWS cloud infrastructure with its Alexa voice assistant network, and Apple? Well, Apple is doing what Apple does best – waiting to show up fashionably late with something that'll make us all wonder how we lived without it.

Then there are the new kids on the block – OpenAI, Anthropic and Perplexity. They are positioning themselves in the AI agentic landscape from different angles: OpenAI's leading AI chatbot and its vast developer ecosystem, Anthropic's rigorous safety-first approach to AI deployment and Perplexity's increasingly popular AI answer engine with real-time information retrieval capabilities. 

But here is the hard truth: All these companies, from tech giants to AI pioneers, are or will be dancing with the same partner – good old-fashioned advertising revenue. 

Google and Meta, the largest ad platforms in the world, will use AI agents as a natural extension to expand their marketing channels. Amazon has risen to the third rank generating $50 billion ad revenue in the last 12 months, Microsoft's search and news advertising revenues increased by 19% year-over-year in Q4 2024 and is expected to grow to $16.3 billion by 2027. Even Apple is betting on advertisements to offset the slowdown in hardware, projecting $10 billion by 2025.

AI pioneers are quietly realizing that training frontier models requires the kind of cash flow that only advertising can reliably provide. When you're burning through billions in computing costs, those sponsored placements start looking mighty attractive.

The coming AI revolution might trigger a potential new advertisement gold rush in an era where personal agents become the ultimate attention brokers. The future of artificial intelligence, it turns out, might be funded by the very same mechanism that built the internet as we know it. 

The great plot twist: why AI agents will make OTAs even more powerful

You would think that in this brave new world of AI agents, travel suppliers can finally break free from the OTA stranglehold by simply outbidding them for AI agent attention. After all, who needs an intermediary when a hotel can pay a preferred placement among AI agents for a fraction of the OTA’s commission, right? 

Think again.

A perfect storm of three interconnected advantages positions online travel agencies to become the undisputed power brokers in the emerging AI agent landscape:

• The bid master's advantage: OTAs have transformed their decades of performance marketing into a sophisticated science, wielding their multi-million-dollar marketing war chests with surgical precision. Every click, every booking, every abandoned cart feeds into algorithms that make their next bid smarter. 
  
  In a world of agentic ad platforms, the game might shift from "cost per click" to "cost per agentic search" – the price of being the first API endpoint an AI agent considers. OTAs will apply their decades-old marketing playbook in this emerging algorithmic battlefield outmanoeuvring suppliers in similar fashion than in the last two decades.

• The trust cascade effect: Just as Google search engine has gradually populated top organic rankings with big brands results, these digital concierges will inevitably learn that large brands usually win in the digital world. By leveraging their massive transaction history, global brand recognition and battle-tested sales funnel, OTAs will essentially become the "blue checkmarks" of the AI agentic world. The result? A self-reinforcing cycle where AI agents increasingly default to OTAs not only to optimize ad revenue, but because experience has taught them it's the safest bet for keeping their human masters happy. 
  
  Trust, in our new AI-driven world, will not just be about brand recognition in customers eyes – it will be about becoming the default setting in the AI agent's decision tree. And large OTAs will already be several branches ahead of everyone else.

• The OTA plumbing hegemony: There is a good reason why current AI chatbots rely mostly on travel aggregators to provide answers whenever users prompt for specific hotel or flight offers.
  
  Decades of metasearch cooperation has allowed OTA to build an API infrastructure capable of processing billions of API calls daily. When AI agents need to shop across the entire travel ecosystem, they are unlikely to play connect-the-dots with thousands of individual supplier APIs – and will instead be going straight for the OTA buffet of standardized, ready-to-consume travel content, be it flights, hotels, cars or activities. These OTA tech stacks will become the de facto backbone in AI agentic travel ecosystems.

And here is where it gets really interesting: every single AI-powered transaction flowing through OTAs' pipelines allows them to make their systems smarter, creating a feedback loop that travel suppliers simply can't match. Each query, each booking, each interaction becomes a data point in an ever-expanding universe of travel intelligence. And in this game, size doesn't just matter – it's practically the whole ballgame.

The tech giants aren't building AI agents out of the goodness of their silicon hearts – they're building new advertising channels. And in this game, the house always wins... and the house likes working with players who offer the most efficient connectivity, strong trustful brands and know how to place big bets. Enter our friends, the OTAs, with their billion-dollar marketing budgets and decades of experience in playing this exact game.

So while suppliers are figuring out their future AI strategy, OTAs are ready to profit from the great attention migration from human eyeballs to an AI agentic future world.