- Travel revolution, digital impact
- Skyscanner’s pioneering role
- Threats, legislative solution
The digital revolution has significantly transformed the travel experience over the last two decades.
The emergence of online travel agencies, comparison sites, and other independent enterprises has significantly expanded our global travel opportunities, exposing us to novel cultures and experiences while fostering enduring memories with loved ones.
In complement to this paradigm shift, Skyscanner was established two decades ago in an Edinburgh bedroom. It emerged as one of the pioneering online flight search and comparison platforms globally, owing to its affiliation with the internet.
Subsequently, the organisation expanded to encompass more than 1,400 personnel across five offices in the United Kingdom, Tokyo, Miami, Barcelona, Singapore, and Shenzhen. We now assist millions of travellers in discovering new locations by searching 80 billion prices daily.
The Threat to Consumer Choice
However, despite this immense growth in consumer options and prospects, the digital marketplace in the United Kingdom is in jeopardy.
The platforms that initially facilitated this expansion, including Google, have progressively transformed into intermediaries that manipulate market regulations for their own benefit, thereby putting the entire system at risk.
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These administrators exhibit a bias towards their own services, irrespective of their quality or the preferences of consumers. This unjustly restricts options, impedes competition, and dampens innovation, which is fundamental to the functioning of the digital economy.
Google is one such gatekeeper, for instance. We welcomed the competition when Google introduced its travel comparison products, Google Flights and Google Hotels, in the middle of the 2010s.
In the years that followed, Google, on the other hand, has utilised its authority over online searches to prioritise its own offerings over those of rival companies. By strategically prioritising Google Flights options over other search results, the company subtly guides consumers towards its own product.
Identifying this “self-preferencing” can be challenging, but its long-term effects on our spending and preferences are very real.
Consider a city in which a single company owns virtually every supermarket. Upon entering any of these supermarkets, patrons are promptly confronted with the company’s proprietary products positioned in prominent areas. To locate the finest, most popular, or personal favourites, one must proceed to the rear section of the store.
As time passes, which you will inevitably lack, your propensity to visit the rear of the store diminishes, consequently depriving you inadvertently of an extensive assortment of products that you may have an affinity for.
For these products to be more visible or accessible, the supermarket company must receive payment from the suppliers.
Equally important, however, are fairness and the foundational tenets of competition, which motivate markets to provide superior consumer service.
A disproportionate amount of influence that a single entity has over consumer decisions harms more than just competitors. It deprives consumers of the complete selection of options and more competitive pricing that they are entitled to. Additionally, it inhibits innovation.
Given the present structure, Skyscanner may not exist if we launched beyond 2015. A talented entrepreneur with a fantastic idea will find it harder to launch a consumer-friendly online travel company by 2023.
Legislative Solutions: The DMCC Bill
The government has appropriately acknowledged that permitting a small number of multinational technology companies to dictate the regulations for the most forward-thinking companies in the United Kingdom is not sustainable. It has formulated a revolutionary new bill, the Digital Markets, Competition and Consumers (DMCC) Bill, which will enable the Competition and Markets Authority (CMA), the preeminent regulator in the United Kingdom, to establish an equitable environment for all British businesses.
The Need for Swift Decision-Making
However, reports that the government is now contemplating amending the bill to make it simpler for intermediaries to appeal CMA decisions intended to increase competition and choice are cause for concern.
It would be highly ill-advised to alter the appeals process in a way that incentivises these firms, endowed with inexhaustible legal resources, to contest and protractedly appeal each CMA decision.
Speed is of the essence when it comes to innovation; if the current gatekeepers were permitted to incessantly demand minute adjustments to app store terms and conditions or ranking algorithms, it could stifle prospective start-up companies within weeks.
To be effective, the CMA must possess the capability to expeditiously render and enforce decisions.
Clearly, increased competition and opportunity are the driving forces behind investment and innovation. We were privileged that our company’s founders conceived and implemented their concept two decades ago, prior to the emergence of Google Flights and self-preferencing.
They recognised that by diligently applying themselves and implementing an effective strategy. They could reasonably anticipate establishing and expanding a prosperous online business.
The UK IT sector and consumers would suffer if the government lets administrators raise the drawbridge.
