Why Hilton, IHG, Marriott are facing a probe in UK
What's the story
The UK's Competition and Markets Authority (CMA) has launched an investigation into major hotel chains Hilton, InterContinental Hotels Group (IHG), and Marriott. The probe also includes CoStar, a commercial real estate data and analytics company. The CMA suspects these firms may be sharing competitively sensitive information through a hotel data analytics tool, potentially harming competition and consumer prices.
Competition concerns
CMA's concerns about data sharing implications
The CMA has raised concerns over rival businesses sharing competitively sensitive information, even through third-party data analytics providers. This practice could reduce the uncertainty that competing businesses usually have about each other's actions. It can also affect competition intensity as it makes predicting and coordinating behavior easier for companies.
Data insights
CoStar's business and CMA's investigation
CoStar's hospitality data business, STR, offers industry-standard metrics like occupancy rates, average daily room rates and revenue per available room. This information helps hotels set room prices, reduce costs and balance supply with demand. A spokesperson for CoStar expressed surprise at the CMA's interest in their long-standing hotel data analytics and benchmarking platform. The company said it is cooperating with the investigation.
Response to investigation
IHG cooperating; Marriott, Hilton yet to respond
IHG has confirmed its cooperation with the CMA's inquiries. However, Marriott and Hilton have not yet responded to requests for comment. The investigation comes after CoStar, Hilton, Marriott, Hyatt and other hotels successfully defended a consumer lawsuit in the US last year over allegations of improper data sharing to keep room prices artificially high.