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Govt urged to regulate online travel agencies

PETALING JAYA: Operators of budget hotels in Malaysia want the Federal Government to regulate online travel agencies (OTAs), arguing that the free-for-all situation online will lead to an unsustainable travel industry, especially during the Covid-19 pandemic.

The Malaysian Budget and Business Hotel Association (MyBHA) also said there was a need to enforce guidelines pertaining to the short-term residential accommodation business.

MyBHA deputy president Sri Ganesh Michiel said the commission that OTAs charged to hotel operators meant that the latter did not get enough profit for the continuity of their business.

“The operational cost is very high but the selling price of the rooms is very low,” he said during a virtual press conference yesterday, where he claimed that the price war among the OTAs was driving prices of rooms downwards.

An OTA is an online marketplace that allows consumers to book travel products and services, including hotels and flights.

Ganesh claimed that there was no control over the commissions earned by OTAs, and that they conducted promotions without any notice or consent from operators.

He added that the whole industry had to be united before they could stop using OTA platforms.

He pointed out that 90% of the public were using these platforms because they were cheaper, adding that the rate of walk-ins had declined.

“If we stop using these agencies, the competitor will get the business. We rely on them to get our rooms filled.

“If we use these agencies, our profits drop by almost 60% to 70%,” he said.

Ganesh also said customers also preferred non-hotel accommodation or residential units, where there was no need for operating permits or business licences.

He hopes that the matter could be addressed in the coming Budget 2022.

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