Very late to comment on Viator.com

Through a happy co-incidence I had a chance to talk on the phone with Viator CEO Rod Cuthbert. If you are not familiar with Viator, they are an Australian based global online destination services company. It has been remiss of me not to talk about them before today.

Founded in 1999 they were one of the first to specialise in non-decrementive destination services (by non-decrementive I mean inventory that does not necessarily related to a specific seat on a specific day to a specific event like Ticketmaster or Ticketek).

Though they have had the early lead, this market is now a much more crowded space with each of the major full service players (Expedia, Orbitz, Travelocity etc) now fully stocked with inventory, old world players like GTA making their extensive inventory available through OctopusTravel.com, the meta-search players attacking the space (eg Sidestep) and new entrants emerging every day such as the recently launched Isango.

I put it to Rod that these (especially the full service players) would present a significant challenge for Viator. I asked him about how worried he was about the advantage that the full service player might have in directing their huge flight volumes into a cross sell path involving destination services. Rod had a couple of good replies - here is what he said:

1. Search Engines: destination specific search engine traffic (ie "Las Vegas Tours", "Jet Boats in New Zealand" etc) favours the dedicated specialists rather than the full service players;
   
2. Purchase Timing: purchase patterns for destinations services are not (with online consumers) aligned with travel arrangement - customers buy destination services at a later time to air and hotel, nullifying the advantage of the full service providers; and
3. Focus: both in terms of the single product and technology focused, but also in their M&A activities including the recent purchase of Vegas based and focused LookTours.
   

On the corporate side they have some good backing with uber PE firm Carlyle and early funding from Australian VC Technology Venture Partners. Rod shared with me that projected 2007 revenues are $65mm and staff numbers are just short of 100. Naturally Viator see their future in an acquisition by one of the bigger players - but not yet. Claim they want to crack the $100mm revenue mark first - so looking for a deal in 2008 or 2009.

Well done to all at Viator (including some fellow Cendant/Travelport refugees such as great Ken Frohling) and best wishes in the battle with the full service players, meta-search and new entrants.