Priceline 2011 Annual Report Download - page 49

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48
Revenues
We classify our revenue into three categories:
• Merchant revenues are derived from transactions where we are the merchant of record and therefore charge the
customer’s credit card for the travel services provided. Merchant revenues include (1) transaction revenues
representing the selling price of Name Your Own Price® hotel room reservations, rental cars and airline tickets and
price-disclosed vacation packages; (2) transaction revenues representing the amount charged to a customer, less
the amount charged by suppliers in connection with (a) the hotel room reservations provided through our
merchant price-disclosed hotel service in the U.S. and at Agoda, and (b) the rental car reservations provided
through our merchant semi-opaque rental car service at TravelJigsaw (which allows customers to see the price, car
type and location of the reservation prior to purchase, but not the identity of the supplier); (3) customer processing
fees charged in connection with the sale of Name Your Own Price® hotel room reservations. airline tickets and
rental cars and merchant price-disclosed hotel reservations; and (4) ancillary fees, including GDS reservation
booking fees related to certain of the services listed above.
• Agency revenues are derived from travel related transactions where we are not the merchant of record and where
the prices of our services are determined by third parties. Agency revenues include travel commissions, customer
processing fees and GDS reservation booking fees related to certain of the agency services listed above and are
reported at the net amounts received, without any associated cost of revenue.
• Other revenues are derived primarily from advertising on our websites.
Merchant Revenues
Agency Revenues
Other Revenues
Total Revenues
Year Ended
December 31,
($000)
2010
$ 1,691,640
1,380,603
12,662
$ 3,084,905
2009
$ 1,447,576
868,395
22,241
$ 2,338,212
Change
16.9 %
59.0 %
(43.1)%
31.9 %
Merchant Revenues
Merchant revenues for the year ended December 31, 2010 increased 16.9% compared to the same period in 2009,
primarily due to an increase in the sale of Agoda and priceline.com merchant price-disclosed hotel room night reservations,
Name Your Own Price® hotel room night reservations and the inclusion of TravelJigsaw since its acquisition in May 2010.
Agency Revenues
Agency revenues for the year ended December 31, 2010 increased 59.0% compared to the same period in 2009,
primarily as a result of growth in the business of Booking.com. Our U.S. agency hotel room reservations benefited from the
integration of U.S. hotels from the Booking.com extranet into the priceline.com website.
Other Revenues
Other revenues during the year ended December 31, 2010 consisted primarily of advertising. Other revenues for the
year ended December 31, 2010 decreased 43.1% compared to the same period in 2009, primarily as a result of the termination
of a relationship with a post-transaction online advertising partner in September 2009.