http://blog.kango.com/kango_ne.....h_149.html

Ok, Albert’s succinct and brilliant 5 words commentary is probably all you really need to read, but what the hell, if you prefer the long winded, convoluted, overly analyzed version, read on! (this shows exactly why I’m never dreamed of pu…

I haven’t spoken w/Rob or Steve Hafner about the deal yet, so this is just conjecture. Seems like there are two additional implications we can draw from your coverage.

First, assuming the comScore’s YOY unique visitors you showed us are accurate, these are not two companies growing their user bases quickly. eyeballing it, it looks like YOY growth of 10, maybe 20%.

Which means generating more revenue from users is more important…

…which is our second implication. Rob has executed more then “quite a turnaround”. It looks like he is monetizing about 75% better then Kayak. i.e. SideStep is generating $35M in revenue from $1B in ticket sales and Kayak is generating $50M from $2.5B in ticket sales. Let’s assume there is some play in those numbers. It still looks a significant positive delta.

We drilled down on some of the other implications and rumors we have heard on our Kango blog.

The first to back out will be the major airlines and the smaller airlines will follow. They are of the opinion that their content has value to meta-searchers which most certainly is true.

Also while the referral or booking fee is often fronted by the airline you have to realize that in the long run fee is being distributed from the airline to the consumer. Airfare meta-search was a novel idea and is extremely useful but if they are to go IPO with any success I am a firm believer that their business and revenue model will have to drastically change.

Airlines may say they don’t want to pay metasearch sites for traffic, but you’re a fool if you believe they will actually stop paying. Airlines have said for 20+ years that they don’t want to pay GDS (like Sabre and Worldspan) crazy fees for bookings, but guess what — they are still paying fees that are outrageously high compared to what Kayak gets paid to send a booking directly to an airline’s website.

BTW, we should really stop calling Kayak and Sidestep metasearch, because they don’t really search multiple sites. I believe Kayak is just a front end to ITA, but they’ve built a really nice UI around it. Kinda reminds me of Google — simple, fast, and easy to use. And, just like Google, they are in the advertising business, auctioning traffic off to all those hungry sites willing to compete for it. If you think Google’s business model has legs, then you have to think the same about Kayak and Sidestep.

Michael Arrington reveals that travel startup Kayak is buying its rival SideStep for $200 Million. SideStep and Kayak are the two leaders in the discount travel search space (along with Mobissimo and Farecast). Kayak is reportedly doing around $50 mil…

kudos to sidestep for getting out while the going is half-decent

otherwise:

yawn

short

parul
http://www.bhopu.com

Who’s the next ex Yahoo (Doug, Yen?) that I know or have worked with who will sell their start up?

…as anyone who has been to one of my seminars knows, but the fact that Kayak has $200M to spend on a competitor SideStep is bubble-icious.

……