Priceline 2014 Annual Report Download - page 16

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result of our international acquisitions. We may not be able to hire, train, retain, motivate and manage required personnel, which may limit our
growth, damage our reputation, negatively affect our financial performance, and otherwise harm our business. In addition, expansion increases
the complexity of our business and places additional strain on our management, operations, technical performance, financial resources and
internal financial control and reporting functions. Our current and planned personnel, systems, procedures and controls may not be adequate to
support and effectively manage this growth and our future operations, especially as we employ personnel in multiple geographic locations
around the world. We are subject to risks typical of international businesses, including differing economic conditions, differing customs,
languages and consumer expectations, changes in political climate, differing tax structures and other regulations and restrictions, including labor
laws and customs, and foreign exchange rate volatility.
Intense competition could reduce our market share and harm our financial performance.
We compete with both online and traditional travel reservation services. The market for the travel reservation services we offer is
intensely competitive, and current and new competitors can launch new services at a relatively low cost. Some of our current and potential
competitors, such as Google, Apple, Alibaba, Amazon and Facebook, have access to significantly greater and more diversified resources than we
do, and they may be able to leverage other aspects of their businesses (e.g., search or mobile device businesses) to enable them to compete more
effectively with us. For example, Google has entered various aspects of the online travel market through its acquisition in 2011 of ITA Software,
Inc., a major flight information software company, its hotel meta-search service known as "Hotel Finder" (discussed below) and its license of
hotel-booking software from Room 77.
We currently, or potentially may in the future, compete with a variety of companies, including:
TripAdvisor, a leading travel research and review website, Google, the world's largest search engine, and other large, established
companies with substantial resources and expertise in developing online commerce and facilitating Internet traffic have launched meta-search
services and may create additional inroads into online travel, both in the United States and internationally. Meta-search services leverage their
search technology to aggregate travel search results for the consumer's specific itinerary across travel service provider (e.g., accommodations,
rental car companies or airlines), online travel agent ("OTA") and other travel websites and, in many instances, compete directly with us for
customers. Meta-search services intend to appeal to consumers by showing broader travel search results than may be available through OTAs or
other travel websites, which could lead to travel service providers or others gaining a larger share of search traffic. TripAdvisor has begun
supporting its meta-search service with offline advertising, and trivago, a leading meta-search service in Europe, has been aggressively
12
•
are owned by Expedia; Orbitz.com, Cheaptickets, ebookers, HotelClub and RatesToGo, which are owned by Orbitz Worldwide (which
has agreed to be acquired by Expedia); laterooms and asiarooms, which are owned by Tui Travel; Hotel Reservation Service and
hotel.de, which are owned by Hotel Reservation Service; and AutoEurope, Car Trawler, Ctrip, MakeMyTrip, Webjet, Rakuten, Jalan,
Hotel Urbano, ViajaNet, Submarino Viagens, Despegar/Decolar, 17u.com, Bookit.com, CheapOair, Mr. and Mrs. Smith and eDreams
ODIGEO;
• online accommodation search and/or reservation services, such as HomeAway and Airbnb, focused on vacation rental properties,
including individually owned properties;
• large online companies, including search, social networking and marketplace companies such as Google, Facebook, Alibaba, Amazon
and Groupon;
• traditional travel agencies, wholesalers and tour operators, many of which combine physical locations, telephone services and online
around the world;
• travel service providers such as accommodation providers, rental car companies and airlines, many of which have their own branded
websites to which they drive business, including joint efforts by travel service providers such as Room Key, an online hotel reservation
service owned by several major hotel companies;
• online travel search and price comparison services (generally referred to as "meta-search" services), such as TripAdvisor, trivago (in
which Expedia has acquired a majority ownership interest), Qunar, Skyscanner and HotelsCombined; and
•
online restaurant reservation services, such as TripAdvisor's LaFourchette and Yelp's SeatMe.