Tomahawk, WI 10/16/2013 (BasicsMedia) – Expedia Inc (NASDAQ:EXPE) is one of the best online travel companies in the world. People use it to get bookings with over 145,000 hotels that are located in more than 200 countries globally. I certainly feel that it has the capacity to surpass its market cap, which stands at $6.60 billion. Recent reports regarding EXPE paint the picture of a company whose activities are currently the subject of investigations. The investigation will focus on EXPE’s federal securities activities, and the law firm behind it is Wolf Haldenstein Adler Freeman & Herz LLP.

EXPE and Other Companies under Suspicion

There is a lot of suspicion regarding EXPE’s prospects and businesses and this is the reason why investigation is ongoing. Investigators believe that a number of top officers and executives working at EXPE issued false information. EXPE split into two in 2011, and with the split, several issues came into the limelight. Problem is that its officers and top executives opted not to share the right information with the public. It is believed that the information never mentioned what kind of impact the split would have on the resultant two publicly traded companies.

EXPE’s 2013 Performance Below 2012 Levels

The company’s performance in 2013 has not been anywhere near 2012. Profits have generally reduced while the overall bookings have not grown as was expected. There have also been allegations leveled against EXPE to the effect that it has participated in price-fixing scandals. It is not the only company under investigation on this. Other companies that are under investigation include Bookings.com and IHG. This investigation does not win EXPE any favors. It may have benefited by fixing prices in the past, but this will come back to haunt the company in future.

Online Booking Industry to Benefit from the Investigation

If EXPE and the other companies are found culpable, this will have a huge significance for the rest of the industry. This practice is quite widespread in the industry and therefore, the conclusions will have a major effect on the companies operating here. It is understandable why EXPE and the others may have chosen this path. The results of fixing prices are both swift and highly effective. Customers rush to these companies in the belief that they are receiving the best deals, only to discover that they could not enjoy their full rights such as discounts.

Instructively, the investigations appear to focus on hotel bookings. Price competition in this area has been quiet low and this has prevented customers from enjoying their full rights. Customers cannot even tell if what they are getting is the best offer in the market or not. I hope that the investigations will help shed some light on this very important issue. It is worth mentioning that EXPE is only one of the few companies that were singled out, not for any wrongdoing as reported by clients, but as representative of the rest of the industry.

I expect the industry to improve once the results of this investigation are published. Customers need to know their full options. They can only make the right decision on whether to use EXPE’s services if they believe that the prices are market-oriented and not the work of price-fixing activities.

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