LLM disintermediation risk discounts Booking.com
The bullish case for Booking.com argues that its current valuation discount compensates for the risk of LLM-driven disintermediation, supported by its resilient European independent hotel network and historical survival against Google.
The argument
The speakers debated whether LLMs will act as personalized travel agents and bypass aggregators. However, they noted that Booking.com has historically grown despite Google's travel search threats, and its deep integration with independent European hotels provides a strong moat.
The thesis, stress-tested
✓ What validates it
- ✓Stabilization of market share against AI travel tools
- ✓Continued growth in European independent hotel bookings
- ✓Acceleration of share buybacks
▸ Risks discussed
- ▸LLMs bypass aggregators to offer direct booking
- ▸Loss of consumer mindshare to AI assistants
- ▸High dependency on search advertising spend
Hear it yourself
"to come up with a good model. Two, as we are seeing that models are pretty much getting commoditized, that means the incremental difference between models is kind of getting saturated, distribution becomes more advantageous. It's the distribution that matters. Whether it is Grog with XAI, Gemini of Google, Meta has a solid distribution. The second thing with Google and Meta is they have a lot of use for AI to make their products better, their ad targeting better, so they don't have to look for a subscription model immediately."
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