Media Contact
Adam Allington
The Federal Trade Commission has issued long-awaited rules requiring companies to display the full price of a concert ticket, sporting event or hotel room, rather than hide away extra charges — often called “junk fees” — until the very end of the checkout process.
David Sherwyn
Professor of Hospitality Human Resources
David Sherwyn, professor of hospitality human resources and law, says there are two primary reasons for these extra fees that will now need to be accounted for in other ways.
Sherwyn says:
“Properties do it to artificially reduces their online rates, so others need to follow because online travel shopping is very rate driven. And two, unlike Europe, U.S. hotels don’t have extra charges for a second, third, or fourth person in a room.
“Requiring transparency will not affect the first point as all hotels will now have to include the rate so consumers will benefit, and the ‘transparent hotels’ will not lose.
“This raises a number of questions hotels will have to address however, for example, the fact that the resort fee, not the room rate, increases revenue when there is more than 1 person in the room. So, will hotels raise rates and let single guests subsidize the room with multiple guests? Or, will they charge for extra people in the room? And will people then start to lie?”