Priceline 2015 Annual Report Download - page 8

booked, but recognize most of our gross profit when the consumer's travel or dining experience is completed. As a result, online advertising expense may not be
recognized in the same period as the associated gross profit.
Competition
We compete with both online and traditional travel and restaurant reservation and related services. The markets for the services we offer are intensely
competitive, a trend we expect to continue, 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 search and reservation booking business ("Book on Google") 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:
• online travel reservation services such as Expedia, Hotels.com, Hotwire, Orbitz, Travelocity, Wotif, Cheaptickets, ebookers, HotelClub, RatesToGo,
CarRentals.com and Venere, which are owned by Expedia; laterooms, which is owned by Tui Travel; Hotel Reservation Service (HRS) and hotel.de,
which are owned by Hotel Reservation Service; and AutoEurope, Car Trawler, Ctrip (in which we hold a minority interest), eLong (in which Ctrip has
acquired a significant minority ownership interest), MakeMyTrip, Webjet, Rakuten, Jalan, Hotel Urbano (in which we hold a minority interest), ViajaNet,
Submarino Viagens, Despegar/Decolar, 17u.com, HotelTonight, Bookit.com, CheapOair, Mr. and Mrs. Smith and eDreams ODIGEO;
• online accommodation search and/or reservation services, such as Airbnb and HomeAway (which is owned by Expedia), currently focused on vacation
rental properties and other non-hotel accommodations, including individually owned properties;
• large online companies, including search, social networking and marketplace companies such as Google, Facebook, Alibaba and Groupon;
• traditional travel agencies, wholesalers and tour operators, many of which combine physical locations, telephone services and online services, such as
Carlson Wagonlit, American Express, Thomas Cook and Tui Travel, as well as thousands of individual travel agencies 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 holds
a majority ownership interest), Qunar (which is controlled by Ctrip), Skyscanner, HotelsCombined and Traveloka;
• online restaurant reservation services, such as TripAdvisor's LaFourchette, Yelp's SeatMe, Zomato, Bookatable (which is owned by Michelin) and
Quandoo (which is owned by Recruit); and
• companies offering new rental car business models or car- or ride-sharing services that affect demand for rental cars, some of which have developed
innovative technologies to improve efficiency of point-to-point transportation and extensively utilize mobile platforms, such as Uber, Lyft, Gett, Zipcar
(which is owned by Avis), BlaBlaCar, Didi Kuaidi and Ola.
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 search, meta-search and/or reservation booking
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), OTC
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 OTC or other travel websites, which could lead to travel service providers or others gaining a larger share of
search traffic. TripAdvisor has begun
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