Speaker unverified: belief

Transcript context

…Yeah. I mean, it seems like the opportunity talks for them is the real story here. Why let it go? But I think this might be a good time... Drew, when we were preparing for this episode, you mentioned sort of a difference between Expedia’s M&A strategy and Priceline’s M&A strategy, and that Priceline sort of took these risks on early kind of sub-scale businesses that they saw potential in and Expedia tends to buy more established things that have a very reasonable growth trajectory from there that they can add to their portfolio. Does it seem like I'm getting that right? Now I’d love to hear your thoughts on that. Yeah. I think that definitely characterized a lot of the deals that made Priceline successful – Active, Booking, Agoda. And again, you saw the strategy we just talked about from Priceline, of buying these businesses and effectively being largely a passive investor, holding them accountable for growth, giving them capital to continue to grow, but not taking too active a role in the management and integration of those businesses. Expedia, by contrast, has built a single dominated scale platform and we should give Expedia its due here. It’s an almost $20 billion business. They do $350 million room nights that Priceline did last year, so it’s a real formidable player in this category. But their approach has been different. They bought Travelocity, they bought Orbitz. They bought Wotif in Australia. They bought these players and their strategy has largely been to say we have a tech platform that is incredibly mature, we put huge investments in and we now want to start to get scale out of it. So they buy effectively these store fronts, replace them with superior economics, superior technology, see some gains in terms of productivity in both clickthrough rate and their ability to monetize it, but have taken a much more active role in the management of the businesses. And then another question is, did Booking need a capital infusion from Priceline? Or what if on their own they just sort of continually reinvested their profits in the business and sort of this aggressive Amazon-style way? Is there any way they could have grown to be the scale that they are today? Or would they have sort of lost out in the arms race of competition?…

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