BBC buys Lonely Planet.... unfair, they cry!

The news that the BBC had bought up Lonely Planet, the famous travel guide publisher, brought out the expected cries of anguish from commercial publishers. The Financial Times asked how a BBC-owned Lonely Planet would make a contribution to "the cultural life of the UK", supposing that to be the remit of the BBC, while the Conservative party reaction was that the BBC was "nationalising" a publisher.

The Lonely Planet purchase may have escaped even louder cries of Unfair! from the private sector because its HQ is in Australia and it was controlled privately by its founders. Competing with Lonely Planet in guides to budget, independent travel are Let's Go, the Harvard-based grandaddy of backpacker advice (founded 1960), the Rough Guides and Time Out.

Low-cost flights have fuelled the demand for guidebooks which tell you where to stay and eat on a budget, although green-aware young people are worrying about the extra low-cost flights and, in some cases, about how the budget guides prevent travellers from contributing much cash to their destinations, often poorer countries.

The deal certainly has tantalising implications for the leisure side of UK media. Lonely Planet was actually bought by BBC Worldwide, a commercial subsidiary of the publicly-funded Corporation. The BBC is paid for by the Television Licence Fee, effectively a form of taxation to support public-service broadcasting; the latest government review means that the Fee will continue until at least 2016, taking the BBC well into the new digital era of broadcasting as a tax-subsidised corporation.

BBC Worldwide had sales of £810m in 2006/07, generating handsome profits of £111m, and there is no doubt that the BBC has benefited from its public television and radio franchise in launching into other media and entertainment markets (video, music, books, magazines etc). The Worldwide arm is believed to have several hundred million Pounds to spend and is likely to focus its investment on digital media, particularly online products. The BBC's main website is already one of the first ports of call for surfing the Web in the UK, with highly rated news and sports pages.

Lonely Planet may have been a pioneer among travellers researching their trips before setting off but independent "reviewing" has flourished, even for package holiday and luxury hotel users. TripAdvisor is the main player but sites like Holidays Uncovered tell you where to go for the best (or worst) karaoke nights and, in one case, which hotel to avoid because of the wild dogs running around the hotel gardens....

Photo source: lvivlviv.com

Eiffel Tower, London Eye: similarities and contrasts

The Eiffel Tower had 6.7m visitors in 2006 - a new record - and the London Eye sells 'over 3.5m' tickets a year, making it the UK's most popular paid-for attraction. These two icons of mass-market, urban tourism offer up some interesting contrasts - as well as similarities - for anyone examining leisure markets in Europe.

The Eiffel and the Eye are in some ways symbolic of the economic and cultural differences that have been deepening between the UK and France. Take your child to climb some of the 1,665 steps to the top of the Eiffel Tower and you will be doing what you did as a child and perhaps what your own parents or grandparents did. The Eiffel is fun to visit but, after 117 years at the heart of a city, it has plenty to teach about history, technology and keeping fit by climbing stairs.

In contrast, the London Eye is an overtly commercial 'ride', taking its inspiration from ferris wheels in the old amusement parks that have evolved into today's theme parks. No better reminder of the commercial reality than the permanent title-sponsorship: it should always be referred to as the British Airways London Eye. As of March 2007, the Eye is just one of many European attractions owned by the private equity giant, Blackstone Group, bringing it to the forefront of cutting-edge investment in leisure. Another contrast, then: the Eiffel Tower remains steadfastly owned by the Paris municipal authority although operation is sub-contracted to a private company. (To complicate matters, part of the land on which the Eye sits is municipal, but this does not affect its operation.)

Tourism needs this combination of hard-nosed commercial reality with more profound cultural experiences. France still has the edge as a destination because it attracted Walt Disney to build its only European park near Paris, so visitors to the region can have a kaleidoscope of experiences. Not that London is lacking in cultural appeal; a short walk from the queues to ride the Eye, the Tate Modern (free admission) is already attracting over 4m visitors a year to puzzle over ground-breaking works of installation art.

What about the similarities?

Firstly, both monuments are centrally positioned in their cities and offer splendid views over the many attractions of Europe's two most popular cities: by nights spent in hotels, London and Paris remain head and shoulders above all other European cities.

Inevitably, both attractions are extremely busy and expensive to visit in peak periods. In 2007, a 'flight' on the Eye costs an adult £14.50, while the Tower is charging €11.50, about £8, for an elevator ride to the top. Fortunately, both are situated in pleasant surroundings where tourists can sit and watch the world go by - the Trocadero fountains and Champ de Mars in Paris, the redeveloped South Bank of the Thames in London.

Another similarity is the excellence of the two attractions' websites with the Eiffel Tower operators, in particular, providing in-depth visitor statistics. The fully private Tussauds Group, immediate owner of The Eye, is understandably more coy about revealing operational data.
www.londoneye.com
www.tour-eiffel.fr/teiffel/uk/ - English version

Tour ops: then there were two?

Hard on the heels of the planned merger of MyTravel and Thomas Cook, two of the UK's 'big four' tour operators, came news that the other two, TUI and First Choice, also wanted to merge. The timing of the deals, within a month of each other in early 2007, means that the companies must have been talking to each other confidentially for a long time about the benefits of consolidating their package holiday businesses.


But why the rush to get married? Unusually candid statements from the air travel regulatory body, the Civil Aviation Authority, about changes in the holiday market are revealing. The CAA, which issues the licences (called ATOLs) to companies selling package holidays, has commented on a fall in the number of package holidays -those 'fully bonded', or insured - sold in 2006. It has taken a few years, but the effect of people organising their own flights and hotels on the Internet, instead of buying ready-made packages at the travel agent, is at least beginning to show through in the statistics. Even the 'big four' are contributing to the trend through their websites, where they offer the flexibility to book flights and hotels seperately.

There were some other reasons for the decline in 2006. Fuel-cost supplements added to the brochure prices were offputting, and the operators are steadily cutting capacity, removing some of the poor-quality hotels that consumers with 30 years of Mediterranean experience are rejecting. But the long term trend is away from the packages and towards independent bookings, which means that online sellers like Expedia and Cendant Flightbookers, Travel 2, etc) are creeping up on the tour ops.

The EU will have to ratify the mergers because the 'big four' operate across Europe. Germany's TUI, if it included the UK's First Choice, would sell around 7.5m holidays out of the UK (a third of our market) but globally it would be a giant with 27m customers a year. The enlarged Thomas Cook Group would sell about 6.5m UK-outbound holidays a year, giving just two companies a market share in excess of 60% of the package holiday business.

The new 'big two' would be German-controlled. TUI (Touristik Union International) is a German company and the enlarged Thomas Cook Group would be 52% owned by KarstadtQuelle, 48% by MyTravel shareholders.

Cost-saving consolidation is the order of the day but the groups are not monolithic in structure. The new number two will take the Thomas Cook name in recognition of trust consumers place in the world's oldest "tour" brand, but MyTravel was an umbrella for many specialist brands which will survive: Cresta (city breaks), Manos (Greece), Direct Holidays (direct-sell), and probably the big general brand at the core of MyTravel, Airtours. These will join former Thomas Cook brochures like JMC and Club 18-30 in the new group.

Thomson Holidays and First Choice are the big TUI brands but the united group brings together a startling range of familiar holiday brands: Simply, Meon, Trek America, Exodus, Hayes & Jarvis, Skibound et al. The specialist holidays - upmarket, long-haul, adventure, clubbing, sporting etc - have been preserved but when booking on their websites, the brochure name is no longer as important as it was when High Street travel agents sold nearly all the packages.