Hilton and Marriott among hotel chains under investigation over data sharing
Three hotel chains and a data analytics firm are under investigation by the UK competition watchdog over suspicions of sharing sensitive information.
The Competition and Markets Authority (CMA) is investigating whether InterContinental Hotels Group, which owns Hilton, Marriott, Holiday Inn, and CoStar colluded on price by sharing information through data analysis tools and so-called algorithms to help them make business decisions.
The CMA said rivals sharing competitively sensitive information through a data provider could enable them to predict what each other will do and coordinate pricing.
“No assumption should be made at this stage as to whether the law has been broken,” the CMA said.
“Following an investigation and fact-finding process, the CMA may issue a statement of objections if it finds a provisional opinion that there has been a violation of competition law.”
The investigation comes as part of the regulator’s efforts to ensure new technologies such as pricing algorithms promote fair competition and are not used to harm consumers.
A pricing algorithm is a data-driven system that determines or recommends pricing levels, usually based on current and historical data about market conditions.
The CMA said: “Companies use various types of data analysis tools and algorithms to help them make business decisions.
“This could provide benefits such as more intense competition, lower costs and faster changes in prices to better match supply and demand in markets.
“But when competing businesses share competitively sensitive information, including through a third-party data analytics provider, it reduces the uncertainty that competing businesses normally have about how each other will behave.
“This can affect how strongly companies compete because it makes it easier for them to predict what each other will do and coordinate their behavior.”
