How agentic AI threatens to upend OTAs : For over two decades, if you wanted to book a trip online, your journey almost certainly began with a familiar acronym: OTA. Online Travel Agencies like Booking.com, Expedia, and Kayak have been the undisputed gatekeepers of the digital travel world. They aggregated millions of flight, hotel, and rental car options, presenting them in a convenient, comparison-friendly format. We, the travelers, got choice and (the illusion of) transparency. In return, they got dominance over the “travel search” process and billions in commission fees.
But a seismic shift is on the horizon, powered not by a new website, but by a new paradigm in artificial intelligence. The era of passive search is ending, and the age of active, agentic AI is beginning. This isn’t just another algorithm tweak; it’s a fundamental re-imagining of how we plan and book travel, and it threatens to upend the OTAs’ dominance at their very core.
What is Agentic AI? Beyond Chatbots and Simple Queries
To understand the threat, we must first move beyond the current perception of AI. Most of us have interacted with AI assistants like ChatGPT or the helpful bots on OTA websites. These are reactive systems. You ask a question, they provide an answer. You input criteria, they filter results.
Agentic AI is a different beast entirely. It is defined by its ability to:
- Act Autonomously: It doesn’t just respond; it executes. It can break down a complex goal (“Plan my 10-day honeymoon to Italy”) into sub-tasks and perform them without constant human hand-holding.
- Make Decisions: It can weigh options based on your stated and learned preferences (e.g., “you prefer boutique hotels over large chains” or “you hate layovers longer than 2 hours”).
- Utilize Tools: This is the game-changer. Agentic AI isn’t confined to one database. It can be granted permission to use various tools and software—browsers, booking engines, calendar apps, payment systems—to accomplish its goal.
- Learn and Adapt: It remembers your past interactions, refining its understanding of your travel style with every trip you take.
In short, if today’s AI is a smart travel encyclopedia, Agentic AI is a proactive, hyper-efficient, and deeply personalized travel agent that works for you 24/7.
The OTA Dominance Playbook: Why They’ve Ruled for So Long
To see how Agentic AI disrupts this, let’s first break down the traditional OTA value proposition. Their dominance was built on a few key pillars:
- The Aggregation Model: They brought a seemingly infinite inventory of options to one place. For travelers, this meant convenience. For suppliers (hotels, airlines), it meant access to a massive audience.
- The “Search-and-Compare” Funnel: The entire user experience was designed around their search engine. You input your destination and dates, and they presented a list. Their business relied on you staying within their ecosystem, clicking on ads, and comparing options on their site.
- The Commission Structure: Every booking made through their platform earned them a commission, typically 15-25% from hotels. This created a multi-billion dollar industry.
- Brand Recognition and Trust: Names like Booking.com and Expedia became synonymous with online travel booking, building immense consumer trust over years.
This model worked because it was better than the alternative—visiting dozens of individual airline and hotel websites. But “better than the alternative” is a fragile foundation when a revolutionary alternative emerges.
The Agentic Assault: How AI Erodes the OTA Foundation
Agentic AI doesn’t just offer a slightly better search; it redesigns the entire travel planning workflow, systematically dismantling the OTA’s advantages.
1. The End of the Search Box: From Query to Command
The OTA business is built on the search box. Agentic AI replaces it with a command.
- OTA Model: “Search for hotels in Paris from Oct 10-15.”
- Agentic AI Model: “Plan a 5-day trip to Paris for our anniversary. We love walking, modern art, and cozy bistros. Budget is $3,000, including flights from New York and a 4-star hotel. Book it.”
The AI agent then autonomously:
- Scours the web for flights that match your preferences and budget.
- Cross-references hotel reviews, locations, and amenities.
- Checks your calendar for any conflicts.
- Presents you with 2-3 curated, complete itineraries.
- And, crucially, executes the booking directly with the suppliers or through the cheapest available channel.
The OTA’s list of 500 hotels becomes irrelevant. The AI does the heavy lifting of comparison, making the OTA’s core product—the search results page—obsolete.
2. Hyper-Personalization vs. One-Size-Fits-All
OTAs personalize by showing you hotels “you might like” based on crude filters. Agentic AI personalizes by understanding your life.
“Find a weekend getaway in February. We need kid-friendly activities, a short flight from Boston, and my spouse is allergic to peanuts, so please verify meal options.”
The AI agent internalizes these deeply personal constraints, something no OTA filter can adequately handle. It builds a long-term relationship with you, not just a transactional one with a platform.
3. Disintermediation: Cutting Out the Middleman
This is the biggest financial threat. Why would an AI agent pay a 20% commission to an OTA when it can book directly with the hotel’s website for a lower rate or through a channel with a lower fee?
Agentic AIs, acting in the user’s best interest, will be programmed to find the best value, not the best commission for a middleman. They will connect directly to Global Distribution Systems (GDS), supplier APIs, and hotel direct booking engines. This disintermediation could vaporize the OTA’s primary revenue stream.
4. The Rise of the Integrated Ecosystem
Imagine your Agentic AI is embedded within your operating system (like Microsoft’s Copilot) or your smartphone’s assistant. Travel planning becomes a natural language conversation within the tools you already use. You no longer need to “go to” a travel website; the travel agent lives in your pocket, integrated with your email, calendar, and messages. This makes standalone OTA apps and websites feel clunky and outdated.
The New Travel Landscape: What Comes Next?
The rise of Agentic AI doesn’t mean OTAs will vanish overnight. But it forces them to evolve or become irrelevant. Here’s what the new travel landscape might look like:
- The “OTA-as-a-Service” Model: OTAs like Booking Holdings are already investing heavily in AI. Their survival may depend on pivoting from a consumer-facing platform to a B2B AI infrastructure provider. They could license their vast inventory and booking technology to the very Agentic AIs that threaten them.
- Supplier Renaissance: Hotels and airlines have a golden opportunity to win back direct bookings. By ensuring their direct channels are AI-friendly (with clean APIs, rich data, and competitive direct rates), they can make themselves the preferred partner for Agentic AIs.
- The Trust and Verification Challenge: How do we ensure these AI agents are truly acting in our interest? New industries will likely emerge around auditing, verifying, and certifying AI agents for transparency and bias.
The Traveler’s Checklist for the AI Era
As this technology becomes mainstream, here’s how you can leverage it:
- Start with a Clear, Detailed Goal: The quality of the AI’s output depends on the quality of your input. Be specific about your preferences, budget, and constraints.
- Verify Critical Details: Especially for complex needs (like allergies or accessibility), use the AI as a powerful first draft, but always double-check crucial information directly with the supplier.
- Understand the Agent’s Incentives: In the future, ask who built your AI agent. Is it designed to find you the best deal, or is it incentivized by certain partnerships?
Conclusion:
The dominance of OTAs was a chapter in the history of travel, not the final page. Agentic AI represents the next chapter—a return to the era of the personalized travel agent, but now powered by infinite knowledge and superhuman efficiency.