June 3, 2024

Case for Localhotels as a Multipolar World Tourism website, and a call for investors

Short history of Localhotels.com

Before getting into why the concept of Localhotels is still valid and important after 26 years of its founding and needed in the age of AI, I will present a short summary of its history.

I had thought of using the internet for marketing travel services in 1991 while doing my masters in mechanical engineering in the US. The web was not yet invented.

In 1992, I have founded a company, Elektronik Bilgi Bilgisayar Ltd. with the aim of doing ecommerce, one of the firsts in the world. After the invention of the web, I started building local travel websites/portals in 1995 and then in 1998 I started Localhotels a directory where local companies around the world could list their hotel booking and travel websites. Many companies asked to be listed in my free directory including booking.nl which was then a small company servicing the Netherlands before being acquired by Wall Street and becoming Booking.

Localhotels never went beyond a small directory site, because I had no money to invest in it in the beginning. Microsoft's Expedia, Sabre's Travelocity and other Big Tech companies like Booking quickly expanded at the expense of local companies. While access to money was the main issue, local companies around the world simply did not believe in the alternative against Western Big Tech.

With the collapse of the Soviet Union and China still a developing country back then, local companies did not envision any alternative and simply did what they were used to until they perished or pushed into small niches.

By mid 2000s, hotels in the US and elsewhere had become captives to Big Tech online travel agencies (OTA) and could rarely do bookings on their own website, thereby losing considerable revenue to Big Tech, and eventually travelers were the ones paying those big commissions to Big Tech.

Some time around 2005, a still operational internet marketing company Milestone Internet in California mainly servicing the Hospitality Sector contacted me and listed 100 of its hotel clients' websites on Localhotels for a year in return for a small fee each and with the perspective of listing 1000 individual hotels if successful. Unfortunately marketing director of the company was replaced soon after and the company did not follow with listing thousand hotels. I still kept the hotels on the site for free for more than a decade. With no other opportunities, Localhotels remained as a concept instead of taking off.

Why choose local instead of global companies for booking travel?

The idea of Localhotels is that travelers should be able to book services at their destination by using companies in that destination rather than global Big Tech.

Sounds pretty straightforward but it is not as easy to implement as it sounds. This idea is actually the concept of Multipolar World that is proposed by Russia and China and BRICS for a fairer and peaceful world order, applied in travel. Directly connecting local companies with travelers is akin to dedollarization in finance because the dollar acts as a very costly medium of exchange due to huge amounts of money printing and debt. Localhotels may also facilitate people to people interactions.

Today, people rarely use local travel companies or hotel websites directly. They are used to go to Big Tech global tourism websites mostly run from the US, thereby missing on alternatives. Habits are hard to break.

Direct contact with local companies and hotels would lower costs and spur competition, including in the US, as global companies such as Booking have been charging 20-30% commissions, sometimes more. Booking has been sued in many countries including Western countries for monopoly practices. The other Big Tech companies have similar practices sharing market with other Big Tech companies, forming oligopolies. Airbnb and other hotel alternative sites also enjoy similar monopoly power.

Localhotels may be owned collectively by internet content creators in the long run but investors will be needed initially. See Content Creators

Tourism in the age of AI

No question AI will have an impact in travel but the main problem of monopoly, higher commissions will remain with the existing Big Tech structure because the problem is both systemic and of mindset.

The AI itself is a black box which gives answers based on the data it is trained on, and filters the results per pre-programmed criteria. All of this depends on the owner of AI. Multipolar World is a concept, it is a mindset. AI will only work along the lines of its designers.

Unlike a search engine, AI acts as a blackbox and reduces the visibility of options as it gives ready-made answers. In tourism too it will present a select option list.

As a test, I have used different AI engines and asked for the list of local booking companies in a few countries. I have noticed that while they find some local travel sites in those countries, they also promote global Big Tech companies among results. Moreover, they also list travel sites that are actually Big Tech affiliates parading as local.

I should also add that there is nothing more AI can add to listing travel services in a country. However, AI can be useful to sort data among services listed per price, quality and other criteria.

Therefore, a simple website and an app that shows local travel company services and hotel offerings around the world is not only a timesaver but also would expand options available to travelers beyond Big Tech. It can also help save money.

Marketing of Localhotels

I have already suggested that Localhotels be marketed by content creators, and eventually owned by content creators, whether they make videos, write articles or create other content. See the page Content Creators

If interested in developing Localhotels, please contact me by sending an e-mail to biz AT localhotels DOT com.


Copyright 1998-2024 MK