Travel Site Pares Refund Program

As online travel services escalate their offerings in the struggle to
dominate the market, at least one firm has had to scale back a program that
was intended to set it apart from the competition.

Corporate-travel company Rosenbluth International’s reportedly
is cutting back on a program it had begun last May that offered refunds to
airline passengers who ran into problems with flights booked through the Web

Biztravel apparently found the program to be far more expensive that it had
estimated as the number of late and/or canceled flights mounted.

The company has paid $1.6 million so far, twice what it expected, Hal
Rosenbluth, chief executive of Rosenbluth International, told the Wall Street
Journal, which first reported the story.

The company is scaling back the refunds it gives for problems with flights on
airlines that include American Airlines, Continental Airlines and US Airways.

However, the site reportedly has extended its guarantee to customers who rent
hotel rooms and cars through companies that include National Car Rental,
Alamo Rent-a-Car,
Wyndham International Inc., Hilton Hotels Corp., ANC Rental Corp and Grupo
Posadas SA.

Online travel is one very competitive business. Just yesterday, travel site
launched a new program
that lets visitors
click on the lowest destination fare and immediately view a 90-day calendar
that shows the flight’s availability. The new service, which Travelocity said
took 18 months and $5 million to develop, is based on an entirely new
Unix-based pricing platform.

And Microsoft’s Expedia service

launched a redesigned Web site
and a revamped flight-booking service that
cost more than $30 million and took more than four years to develop. The new
service, no longer restricted to old mainframes, offers more combinations on
pricing and itineraries and more ways to sort flights by price, flight time
and takeoff/departure times.’s new refund structure, according to published reports, will
offer airline refunds of $25, as opposed to $100, for customers whose planes
arrive more than 30 minutes late, and $50, as opposed to $200, for delays
over an hour. Instead of a full refund for flights delayed more than two
hours or canceled on the day of departure, Biztravel will pay $100.

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