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Colorado-based aviation consultants the Boyd Group:
"Airlines have a product, and they are selling their product.
They have control of the entire chain."

The quartet of airline jumbos announced they will pool
$100 million to launch their still-unnamed Web site in first
quarter 2000. They'll offer everything from cheap fares to
rental cars and hotel rooms.

RACK RATES. Although auctioning -- similar to what
Priceline.com provides -- won't be offered initially, the
airlines are not ruling such pricing strategies out. Nor do
the airlines seem to be concerned about cannibalizing their
existing individual sites, which all four will continue to run
full tilt. "I don't see any conflict with offering rack rates
and distressed inventory side-by-side. We will give the
lowest published fares anywhere. Anything you find on the
Web, we will have," says Al Lenza, Northwest Airlines
vice-president for distribution.

According to Forrester Research, by the end of this year, 9
million Americans will have booked online, for sales of
nearly $8 billion in leisure and business travel. That
number is expected to climb to 26 million customers
booking $29 billion by 2003. "The airlines are watching
this new behavior of booking grow rapidly, and they are
seeing most of it go in the direction of online travel," says
James McQuivey, a Forrester research director.

To some degree, the airlines have already successfully
herded loyal customers to their own Web sites with a
barrage of frequent-flier incentives and exclusive discounts
for booking online. According to Internet consultants
Jupiter Communications, 79% of the online sales in 1996
went to travel agencies like Expedia and Travelocity . The
rest went to direct travel suppliers like airlines and hotels.
As of last year, that ratio was closer to 50-50. And some
airlines have already made it abundantly clear they don't
want to deal with a middleman, period. Southwest Airlines
ceased to pay commissions to any online travel agency in
an effort to maximize bookings through its own Web site.

HEALTHY NUMBERS. While brick-and-mortar travel agents have
the most to fear from a Big Four portal, Travelocity and
Expedia are hardly helpless targets. Travelocity, through
its acquisition of Preview Travel, has control over travel
sales on America Online and Yahoo!, the two most
powerful ISPs out there. And with Microsoft's bucks
behind it, Expedia has unlimited marketing resources.
"Plenty of customers want to go to an independent agency
like Expedia. We have 4.1 million customers coming to us
every month. That's a compelling marketplace," says Suzi
Levine, a product manager at Expedia.

The big travel Web sites have continued to post healthy
triple-digit annual growth numbers -- thanks in part to all
those commissions airlines pay them. According to Boyd,
United will pay out nearly $250 million in commissions
this year, even after the recent reduction. The airlines
"want that money back," says Boyd.

And with control of so many domestic flights between the
four, the airlines could wield strong control over inventory
and use that as a weapon to ensure market share and
preferred pricing. For their part, the airlines say they want
to build a completely impartial site, much like American
Airlines' Travelocity. "This thing has to be neutral, and it
has to be all-encompassing," says Northwest Airlines'
Lenza.

But the announcement of a jumbo Web portal certainly
failed to stop the cork-popping at Expedia the following
day. Shares of Expedia, of which Microsoft holds 85%,
soared to $65 per share on the first day of trading, up from
the initial price of $14 per share. The big question now:
Will the four airlines' portal spoil Expedia's party?

By Alex Salkever in Honolulu

Pos. 2 :

Will the four airlines' portal spoil Expedia's party?

The four major airlines will not be able to avoid business with TRAVELBYUS because TBU's website will be the most unique , effective , efficient and expediant travel site on line. People are going to flock to this site for information for their vacations. And the airlines will want them to have direct access to their flights. And Mr. Cheap Seats already has contact with these airlines re booking.

Let's face it, the travel industry is huge and is expanding more and more online. There are still wide open cypberspaces out there for, and once again, this has been repeated in other sectors as well, the GOOD companies. These are the companies hat will prosper and exist many cyberyears and TRAVELBYUS will be there!