Hyderabad: Hotel bookings through online portal Oyo Rooms will become invalid or stand cancelled from December 25 onwards, just as the year-end holiday season begins.
“Initially OTAs helped us in expanding our business and it was a win-win situation for both parties. Subsequently, when they started to increase their valuation at the cost of the growth and revenue of the hotels, the damage to hoteliers began,” Ashok Reddy N., a member of the TS Hotels Association said.
“Earlier when hotels were doing direct business the returns were sufficient for running the hotel. Today OTAs have reduced the prices,” he said, adding, “No doubt the consumer has been benefitted.”
The falling out began when the commission was increased to 25-40 per cent on discounted rates. “Hundreds of hotels in Hyderabad have converted into paying guest houses as they failed to meet the expenditure. Hotels which were able to sell the rooms for Rs 2,000-Rs 2,500 are earning only Rs 1,000-Rs 1,200 today, after paying commissions,” S. Venkat Reddy, another hotel association member said.
He said indiscriminate discounts were being offered by OTAs. “These companies are minting money with the high commission but are causing heavy losses to the hotel industry,” he said.
The hoteliers and Oyo had not struck consensus till Saturday. Oyo has allegedly said that hotels boycotting the service would face cancellation of future business dealings.
“We do charge a convenience fee on booking. Other OTA channels do charge a convenience fee. Whatever amount we get from OTA, we forward it to the hotel. This is how it is and will be until further notice,” the Oyo management said in a statement.
“For any assistance, reach us. If any check-in is denied to our guest, then we would be forced to put a 'sold out' tag on the property and shift all future bookings to nearby properties,” it said.
Over 200 hoteliers in Hyderabad, who had tied up with Oyo, have decided to boycott the company over alleged indiscriminate discounts and high commission.
Currently, Oyo and other online travel aggregates (OTA) collect commission to a tune of 25-40 per cent on each hotel booking and this has dented the industry, hoteliers said.
All bookings through OTA like MakeMyTrip, Yatra, Travel Hub and Goibibo will stand cancelled from January 1. This means if someone has made a booking at a city-based hotel through any of these portals, they will not be entertained upon providing the hotel voucher.
The agitation against OTAs by thousands of hoteliers through their associations is catching up. It began in Ahmedabad, then spread to Pune, Bengaluru, Chandigarh and has now reached Hyderabad,
The hoteliers and Oyo had not struck consensus till Saturday. Oyo has allegedly said that hotels boycotting the service would face cancellation of future business dealings.
