When I asked ChatGPT for “a quiet hotel near Alfama with a balcony” a few weeks ago while planning a weekend in Lisbon, I noticed something wasn’t quite right. Booking.com provided the first three recommendations. Expedia is the fourth.
There was no sign of the independent boutique I had visited two years prior, the one with the cracked tile floors and the proprietor who insisted on pouring his own ginjinha at check-in. Not on the first page. Not on the second page. In the AI’s universe, it just didn’t exist.
| Topic Snapshot | Details |
|---|---|
| Industry | Online Travel & Hospitality Technology |
| Key Players | Booking.com, Expedia Group, OpenAI, Google, Perplexity |
| Core Issue | AI assistants becoming new distribution gatekeepers |
| Regulatory Framework | Digital Markets Act (EU, 2024) |
| Daily AI Assistant Users | Roughly 800 million weekly across major platforms |
| Expedia Group Reach | 200+ sites, 75+ markets, 40+ languages |
| Daily Visitors (Expedia) | 10 million |
| Annual Bookings (Expedia) | Over 1 billion |
| US Hotel Supply Controlled by Chains | Approximately 72% |
| Projected AI Agents by 2045 | 100 billion daily active |
| Consumer Trend | Two-thirds use AI for travel research |
That is the aspect that no one is actually discussing. Booking and Expedia locked down what appears to be a pole position within days of OpenAI launching its app marketplace. Before anyone bothered to inquire as to whether they should, they moved quickly. And that’s what makes the way this is unfolding unsettling. As of yet, there are no regulations. There is no referee. There are only two businesses that have spent twenty years honing the craft of being the route that every traveler must take.
This kind of issue was intended to be resolved by the Digital Markets Act of the European Union. Google, Apple, Amazon, and the others were compelled to cease subtly favoring their own services. You can own the highway, but you can’t control who gets a billboard, so the idea was fairly reasonable. The problem is that the law doesn’t quite reach the new gatekeepers because it was written before generative AI became widely used. Perplexity, Gemini, ChatGPT. They are all not officially covered. And that gap is beginning to feel more like an open door than an oversight.
What happens when an AI assistant uses the chat window to book a hotel for you instead of just suggesting one? You cease making comparisons. You give up scrolling. You have faith in the response. And the winner is the person who paid to be that response. There seems to be disagreement among industry observers regarding the level of concern. Some claim that since travelers can now ask a chatbot directly and avoid the middleman completely, AI will eventually devour aggregators. Some, who are more dubious, point out that Booking and Expedia aren’t exactly waiting to be upset. Before the new layer solidifies, they are purchasing their way into it.
The urgency is explained by the numbers. Ten million people visit Expedia every day. More than a billion reservations annually. Imagine that scale connected to a system that processes about 9.6 billion behavioral signals every day, refining recommendations every minute. That is unmatched by a family-run lodge in Vermont or an independent innkeeper in Porto. They were never able to. However, you could purchase an advertisement with Google. You might not even participate in the conversation with a conversational AI.
It’s difficult to ignore the pattern. Hoteliers learned a lesson from the OTA era that no one really wanted to learn: the guest is controlled by whoever controls the interface. Therefore, the battle that lies ahead is not so much about technology as it is about the regulations surrounding it. extending the protections of DMA to independent AI assistants. requiring open ranking. Paid placements should be clearly labeled, and pharmaceutical advertisements should include warnings. requiring portable inventory data in order to give smaller players a chance to be noticed. It’s unclear if American lawmakers will support the initiative, as European regulators have urged.
There’s a subtle sense that we’ve been here before as we watch this play out. In 1999, the web promised transparency. In 2009, Mobile made that promise. The gates were ultimately owned by a small number of players each time. AI might be different. Perhaps governments will act swiftly enough to make a difference, or perhaps tourists will demand transparency. However, I wouldn’t bet the boutique hotel on it based on the past 20 years.
