ISHC

The OTA perspective

Michael ReichartzVP, Market Management

Expedia as a data source

Expedia Partner Services Group | 2© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary.

We have a unique view into the industry…

© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 3

Source: Expedia, Inc. Feb 2010

5M+activities sold

5M+cars rented

35M+calls with customers

67M+roomnights

booked

25M+air tickets sold

2M+calls with partners

$21Bgross bookings

30M+traveler opinions

on TripAdvisor

58M+visitors/month

2M+packages sold

…And a unique view into consumer behavior

© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 4

More than 850,000 flight

shoppers globally, per day

More than 78,000

activity shoppersglobally, per day

Nearly 864,000hotel shoppers

globally, per day

We have more than 58 million visitors to our sites every monthSource: Omniture Data 2009; Packages from Expedia Data Warehouse, Feb 2010

Nearly 6,800 packages sold

per day

Our view covers multiple segments…

© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 5

#1 online travel agency globally, with a presence in 19 countries

Leading hotel specialist globally, with over 70 localized sites

Leading value-based travel provider

#1 online travel community, operating in North America, Europe & APAC

Business-to-business / private label brand

Full service travel management company operating in 24 countries

Expedia holds a leadership position in nearly every geographic market where we are present

Agency model providing hoteliers a geographically diverse source of demand.

The leading online travel planning site for booking hotels and flights in China

…And our perspective is global

© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 6

Source: Expedia.com as of February 17, 2010.

19961998

19992000

2001

AustraliaFranceCanadaGermanyUKUS

Belgium

India

Netherlands

Italy

Spain

New Zealand

Ireland

Austria

Denmark

Norway

Japan

Sweden

Mexico

20042005

20062007

20082009

73 Hotels.com sites worldwide

© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 7

Source: Hotels.com as of February 2010. ¹,²,³ Indicates multiple languages of the same site.

1991

US

20012002

20032004

20052006

20072008

2009

Poland

Russia Ukraine

Slovakia

Croatia

Estonia

Latvia

Lithuania

Turkey

Czech Republic

Greece

Hungary

Iceland

Argentina

Chile

Israel

VenezuelaTaiwan

South Africa

Singapore

Portugal

Philippines

NewZealand

Mexico¹,²

Korea

Japan

Hong Kong

Brazil

China

Colombia

Switzerland¹,²,³

Sweden

Spain

Norway

Netherlands

Italy

Ireland

Germany

France

Finland

Australia

Austria

Belgium¹,²,³

Denmark

Canada¹UK Thailand

Malaysia

Uruguay

Suriname

Peru

Paraguay

Panama

Nicaragua

Honduras

Guyana

El Salvador

Guatemala

French Guyana

India

Ecuador

Costa Rica

Belize

Bolivia

Canada²

Source: Expedia Inc. Tolgamart June 2009

We offer 124,000 hotels from across the globe

Americas50,000

EMEA61,000

APAC13,000

© 2009 Expedia Partner Services Group. All rights reserved. Confidential and proprietary. | 8

What we see as an OLTA

Expedia Partner Services Group | 9© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary.

We see a lot of visitors from international origins…

11 Mill Impressionsin last 6 months

APAC to AMER

49 Mill Impression in last 6 months

EMEA to AMER

JPY, -10%

CAD, -4%

GBP, 6%

EUR, 10%

2009 2010

…And exchange rates alter travel patternsUSD value in flux; 1 USD in foreign currencies YOY; January 2007-August 2010

2007 2008

Source: Oanda FX Data

© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 11

Pound36%

Canadian Dollar23%

Euro8%

Japanese Yen-19%

Exchange rate influence on purchasing powerA family of four takes a vacation from London to Orlando4 air tickets and 1 room for 3 nights

Jun 2009 Var Jun 2010

Air $2,102 +48% $3,116

Lodging $224 0% $225

Spend $2,326 +44% $3,341

© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 12

American supplier receives in USD…

Jun 2009 Var Jun 2010 FX

Air £1,286 +65% £2,116

Lodging £137 +11% £153

Spend £1,423 +59% £2,269 +11%

British family spends in GBP…

Leisure visitors to the US from the US, EU & UK are trading down, while visitors from APAC are trading up

1 - 2 Star 3 Star 4 Star 5 Star

Domestic US +2% +2% -4% 0%

EU +7% 0% -6% -1%

UK +4% +2% -4% -2%

Australia 0% -4% +2% +2%

Japan -2% -2% +2% +2%

% = Change in room nights share YoY Booking made in May – August for stays in September - December

Source: Expedia future stay data (booking made in May – August 2010 for stays in September – December 2010 vs. May – August 2009 for stays in September – December 2009

Despite economic uncertainty, a recent survey suggests a cautious recovery in business travel…

Source: Survey of over 300 Egencia clients, conducted August 2010 | Survey of over 100 Egencia clients, conducted October 2009

Are you planning to increase or decrease your travel budget in 2011?

…The recovery is reflected in the industry numbers

Source: ATA, Smith Travel Research,

“Airlines in North America are adding a few extra seats this month for the first time since 2007, according to an aviation industry research firm.”

Corporate travel is leading with lower ADR while Leisure travel is seeing higher price increases

Source: Expedia inc. Internal Data

…Encouraging leisure travelers to cut their vacations short…

Source: Expedia stayed data year-to-date (Jan– Aug2010); Excluding Hotwire

YoY Average Length of stay; by stay month

…And spend more time shopping aroundYoY Air Searches

Source: Expedia inc. Internal Data Jan – Aug 2010 (Xlogs)

37% more searches to Cancun

39% more searches to Las Vegas

21% more searches to San Francisco

17% more searches to Orlando

In leisure markets, travelers are booking further ahead

Source: Expedia stayed data year-to-date (Jan– Aug2010); Excluding Hotwire

YoY Growth in Booking Window

Stay Month

For leisure the deal remains “King”…

Source: Expedia inc. Internal Data 7- 2010 (Booked)

Example: Fort Lauderdale Packages70% of packages have at least a 20 % savings

…And promotions make a difference…

Property Grouping Average Promotion Mix YoY Room Nights

Top 5 Winners 80% 103%

All Other 37% -10%

Example: Hotels in Phoenix

…With travelers cautious about their purchases

Source: Expedia inc. Internal Data Q2 2010 (Booked)

Scores 4.0 and higher convert 2X better

Example: Hawaii – Big Island

User Review Score YoY Room Nights

4.0 and Above +39%

Below 4.0 +4%

“87% of travelers found traveler-generated reviews from people they didn’t know influential in deciding where they would purchase their leisure travel”.

(PhoCusWright Inc)

Word of mouth makes a real difference in travel marketplace

Source: Expedia, Inc.; The PhoCusWright Consumer Travel Trends Survey 10th Edition

Low HighTraveler Opinion Score

Impact of traveler reviews on purchase conversion

© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary. Expedia Partner Services Group | 23

Value of user reviews..

+2 points in a review = +.5 star rating plus moving one mile closer to city center

+1 point in a review = 9% increase in ADR

2x as many people strongly agreed that they took recommendations from total strangers on travel advice websites over and above those made by family and friends (Hotels.com study)

Thanks!

Expedia Partner Services Group | 25© 2010 Expedia, Inc. All rights reserved. Confidential and proprietary.