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Expedia buys Orbitz for $1.3B – so will your vacation cost more as a result?

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If you're a regular traveler, there's a good chance you'll have used either Expedia or Orbitz to make a booking before.

Well, the two online travel agency giants are set to become one, after a deal was agreed to that will see Expedia buy Orbitz for $1.3 billion, as reported today by the Wall Street Journal.

But what will it mean for consumers? Generally, when two major players in a given industry (Expedia is first, Orbitz third in online travel bookings) join forces then prices for consumers tend to rise as competition is reduced. points out this happened when United and Continental merged, and there are fears the same will happen to cable TV customers should the Comcast-Time Warner merger go ahead.

But the magazine says this shouldn't happen with Expedia and Orbitz despite Priceline (which owns Kayak, among others) now being its only main competitor.

In fact, there's the potential prices could well fall.

The two companies will retain their individual identities, reports say, and the reason why industry experts think it won't lead to a rise in prices is because the actual business model of these companies is to offer consumers as much choice as possible to ensure they secure bookings through their websites.

Bloomberg reports that having Orbitz on board should actually give Expedia more clout to negotiate better deals from hotels and other travel companies, reducing the cost for consumers.

What's more, although Expedia and Priceline are the two big travel search engines, they still face plenty of competition elsewhere as well, not least through hotel, airline and car rental companies selling deals directly to consumers, as well as other niche websites such as AirBNB.

It remains to be seen whether the predictions come true, but for now, there is hope that this particular corporate merger won't hit consumers in the pocket.

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