VentureBeat

With so many online travel sites crowding the market, you’d think we were nearing a Web 2.0 travel bubble. But according to travel information search engine UpTake, which is launching May 14, there’s still an untapped niche in the market: a travel-opinions supersite.

The market is extremely fragmented with thousands of micro-sites for individual hotels, beaches, airlines and leisure activities. UpTake’s goal is to gather opinions from all of those sites together and become the most comprehensive research tool used by travelers.

“The booking sites are good when you know that you’re going to Maui on May 17 and want to stay in a Hilton Hotel. But if you don’t even know whether to go to Maui or Kauai, it’s not that easy,” said CEO Yen Lee, who was General Manager of Yahoo Travel before he left to start UpTake in late 2006.

The site features a personalized filter that, unlike traditional search engines, lets you customize your search according to profiles such as “kid friendly”, “beach”, “romantic” or “adventurous”. These keywords are matched againt a database of more than 20 million traveler opinions from more than 1,000 review sites across the web, including WAYN, TripSay, IgoUgo and, potentially, another newcomer by the name of Tripwolf (more on them later). The ratings collection now spans about half a million places to go, things to do and places to stay. The database will expand rapidly, according to Lee. Searches will be matched with search word ads displayed along with non-commercial search results.

A traveler with unclear travel plans visits, on average, 22 sites before booking a flight or hotel, according to a recent study by Google and Comscore. UpTake wants to turn these 22 jumps into one smooth stop. “We’re like Google, but we’ll only do travel”, said Lee. But he added that unlike Google , UpTake’s database is prepared to ask travellers the big questions: why they’re travelling and who they’re travelling with.

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Online travel sites are an increasingly crowded space, so much so that it can be difficult to differentiate between them. NileGuide is attempting to offer something different, a full-service travel site that exists online. The site will help you plan a trip from start to finish. The mission is to own the trip itinerary business.

NileGuide saw the first wave of travel sites as useful simply for booking. The second wave, was good for limited user-generated content. Now comes the time for a third wave.

NileGuide will offer a site that has experts in multiple locations around the world who can give you information that is accurate and relevant. The company has 75-80 experts from all around the world, about half are in the United States, and half in the rest of the world.

“NileGuide is like having your own travel agent, tour guide, and concierge wrapped into one,” NileGuide co-founder and chief executive, Josh Steinitz says.

The site uses a hybrid model for offering recommendations for users. Ninety percent is done by software calculations; the other 10 percent is pulled in from the site’s own editorial content and the local experts. This insures that results will be served up quickly.

On top of the experts, NileGuide will pull in information from sources such as CitySearch, Expedia, OpenTable, and TripAdvisor. From here, users can build a comprehensive, personalized travel guide, “with the serendipity that makes travel special”, Steinitz tells us.

Other players in the online travel space include Kayak and the larger sites Expedia, Travelocity, Orbitz and Hotwire.

The San Francisco-based NileGuide was founded in 2006. Its initial angel investors included Draper Richards and KPG Ventures.

As someone who has been home for one weekend of the past six, I know that traveling can be a real pain. While the Internet has eased some burdens such as scheduling and price hunting, it has also created new ones, such as organizing trip details when plans are often made across several sites. That is where a site like TripIt comes in.

There are a lot of online traveling sites such as Kayak (our coverage), but TripIt sets itself apart by organizing your travel information after you have scheduled it.

Using TripIt is as simple as forwarding the travel itinerary email that you get sent when you book a site online to the email address, plans@tripit.com. Assuming you’ve sent the email from an address you have registered to your TripIt account, the service will then build you a new itinerary within TripIt that adds several useful items such as weather information, access to maps of the area, pictures of the area from Flickr and other features. The great thing about forwarding these plans is that TripIt will take several different details such as a flight and hotel booked on separate sites, and place them together one one page.

“We have so many overlapping applications, and the next frontier is getting them to work better together,” says Tim O’Reilly of O’Reilly AlphaTech Ventures, one of the site’s investors.

The service also has social features that allow you to share plans with friends and find out when someone you know is near you on a trip. In this regard, TripIt is similar to a service like Dopplr, but TripIt has offers organizational tools far beyond that service.

The best feature of TripIt is the ease with which you can access all of your organized travel information on a mobile device. Printing out and organizing multiple sheets of paper for various reservations is a hassle. The recently launched TripIt Mobile eliminates that waste.

This latest $5.1 million series B round was led by Sabre Holdings, O’Reilly AlphaTech Ventures and European Founders Fund. The San Francisco-based company previously raised $1 million last year from O’Reilly AlphaTech Ventures (our coverage).

This new investment will be used to expand development, marketing and support for those users who have signed up with the service. Additionally, with the European Founders Fund on board, TripIt hopes to expand its service globally.

Online event planning sites work well to let people know what is going on when and who will be in attendance. However, these sites lack the ability to handle more advanced logistics, such as travel arraignments, until now.

One such event planning site, MyPunchbowl is teaming up with leading travel site Kayak to launch the MyPunchbowl Party Center. This new area will work exactly as you might expect. Just as on Kayak, you can search flights, cars and hotels. Simply input the dates and you’re presented with options — all without leaving MyPunchbowl’s site.

“In this difficult economic climate, many travelers may need to price a trip before replying to an online invitation and now these consumers simply and quickly use the Kayak.com search widget to research prices and availability without leaving MyPunchbowl.com,” said Paul English co-founder and CTO of Kayak.

This combination helps differentiate MyPunchbowl from competitors such as Yahoo’s Upcoming, Yelp’s Events area and even Evite.

Both MyPunchbowl and Kayak clearly want to launch this functionality now as the high school and college graduation season begins. With some six million students will graduating this year according to the U.S. Census, that will mean a lot of families and friends moving around to see the event.

One type of event the company doesn’t mention in its list of possible examples seems an odd omission — weddings. Of course, most people hire very expensive coordinators for those and putting that together through MyPunchbowl might not exactly scream elegance. Still, it seems like the Party Center would be useful for other guests to have a place to set up trips for such events.

We previously covered MyPunchbowl here and here. Find our coverage of Kayak here.

The VentureBeat team is mostly taking a much-needed holiday break this week. In the meantime, here’s some of the latest news:

1. Apple devices to offer payment service?
2. Digg tells BusinessWeek that “no acquisitions are in the works” but we’re sticking by our story
3. Amazon Music Store to sell Warner Bros. music
4. Apple’s iTunes to rent Fox Studios movies
5. Web analytics service Compete examines Kayak-Sidestep travel site merger

Apple devices to offer payment service? — The company has recently filed a patent for “a wireless system that would allow customers to place an order at a store using a wireless device such as a media player, a wireless personal digital assistant or a cellphone,” Brian Caulfield reports. Phones in other countries, most notably Japan, can already be used to make credit card purchases at stores. Here in the US, we are still looking forward to this feature. (Image via Phone Different.)

Digg tells BusinessWeek that “no acquisitions are in the works” but we’re sticking by our story – Earlier this month, a well-placed source told us that social news site Digg has hired a bank to help it sell itself for $300 million or more. However, companies that are looking to sell usually won’t admit it publicly. Instead, they like to talk about how they’re focused on building a big business. True to form, Digg chief executive Jay Adelson only tells BusinessWeek about a number of new Digg features, and the potential for the company’s international expansion. He also says that Digg’s new advertising deal with Microsoft has been “great” since it started a few months ago.

Amazon Music Store to sell Warner Bros. Music — For some time, we’ve been hearing that Amazon’s music service has been growing quickly, as users are able to purchase songs and albums from it that don’t have restrictive digital rights management (DRM) software in place. DRM software technology is unpopular because it prevent you from buying a song then freely copying it to multiple computers and music-playing devices. Now, Warner Bros. will also sell music without DRM (press release here), following similar moves by EMI and Universal Music Group, who already sell large portions of their music catalogs DRM-free on Amazon. Apple’s iTunes has also begun to sell some DRM-free music — it has a DRM-free partnership with EMI, but not Universal. No word, yet, on whether Warner Bros. will offer DRM-free music through iTunes.

Apple’s iTunes to rent Fox Studios movies – Despite the competition from Amazon, Apple has more plans in the works for iTunes, the Financial Times reports. Apple will let iTunes users “rent” the latest DVD releases from Fox Studios — which means you can pay to download a digital DVD copy of the movie from iTunes for a limited time. Apple already lets you purchase Disney movies (Apple chief executive Steve Jobs is Disney’s largest individual shareholder), as well as a few Paramount titles. Aside from these companies, most studios have, like the record labels, balked at Apple’s efforts to cut deals with them. See the Wall Street Journal for more.

Web analytics service Compete examines Kayak-Sidestep travel site merger — Lots of detail on what Compete says is “among the most significant news items of 2007,” here. Our previous coverage of the deal is here.

Updated

Travel search engine Kayak has taken on $196 million in additional funding from a prominent group of investors.

It has separately purchased main rival SideStep for $180 million, as well as $20 million in the company’s bank account for a total of $200, Techcrunch first reported. [Update: We now hear from a source that the total sale was for slightly less: $175 million plus $18 million in cash, for a total of $193 million.]

Together, the companies will aim for a “tremendous” initial public offering next year, said Woody Marshall of Trident Capital, an early investor in SideStep, confirming the news.

[Update: The company itself is demure about the possibility of an IPO, saying instead that it wants to focus on being the number one travel site in the coming year.]

There has already been “strategic interest” in both companies — potential acquirers — Marshall said.

Both provide search-based travel sites where users can find travel information such airline flights, car rentals, hotel reservations, and discount travel deals. Search results may send you to other aggregators, like Orbitz, or online travel agencies. SideStep also offers travel guides, hotel reviews and downloadable toolbar, that will now be accessible by Kayak users.

Norwalk, Connecticut-based Kayak and Santa Clara, Calif.-based Sidestep are the two market leaders in this search vertical (see Hitwise graph below), and have mostly separate user bases, according to Marshall (note: He’s no relation to Matt Marshall, VentureBeat’s editor) .

Smaller travel search competitors include Farecast, Mobissimo, cFares, Tripit, niche travel products, off-the-beaten-path vacation search Tripology, and many others. The larger of these startups may now be acquisition bait, as leading travel sites like Expedia and Orbitz or large internet companies like Yahoo and Google look to expand their travel search services.

Kayak will be the main brand, and Sidestep will use Kayak’s search technology, although Sidestep will keep its brand, Marshall said. Key members of SideStep will join Kayak’s team. The companies say they will combine travel data, such as travel rates and availability, and other services. Affiliate partners of the companies include: About.com, Comcast, LonelyPlanet, Rand McNally and USA Today.

Both companies are generating large amounts of cash through CPM (where advertisers pay per thousand advertising views), CPA (where advertisers pay when a user actually buys a fare or ticket) and CPC advertising (where advertisers pay when a user clicks through to their site), according to Marshall. The Techcrunch article reports Kayak is doing roughly $50 million in annual revenues, while SideStep does $35 million.

The advantage of an IPO will be to boost the company’s brand awareness. Cash isn’t the paramount consideration, since the merged company already has ample funds for further expansion, Marshall says.

Both companies have racked up venture capital funding. Kayak took funding from General Catalyst, a Boston firm that first looked at Sidestep (see here), as well as Sequoia (Michael Moritz was the lead investor, and will now join Kayak’s board), Accel Partners, and AOL. Our previous coverage here.

Sidestep has taken a total of $27 million in funding from Trident Capital, Leader Ventures, Saints Capital, Norwest Venture Partners. Our previous coverage here.

Sequoia, Accel, General Catalyst, Trident and Norwest put money into this latest round, along with new investors Oak Investment Partners and Lehman Brothers Venture Partners, and debt lenders Silicon Valley Bank and Gold Hill Capital.

Kango, a travel search engine that finds lodging and activities that match your personal preferences, is launching a closed testing version and announcing that it raised $4 million from Shasta Ventures earlier this year.

This area is extremely competitive. Companies like Kayak and Sidestep, which search multiple sites for the best ticket prices, have raised millions from marquee VCs; cFares, which finds wholesale plane tickets at discount rates, recently raised $4.5 million. TripIt makes it easy to manage your travel plans and share them with others and raised $1 million. We recently used and like Farecast, which does much of this, and offers predictions too. The list goes on and on.

But Palo Alto’s Kango is doing something different. Rather than pricing airfare and hotels, it wants to help you plan what to do once you reach your travel destination. You can already do this using tree-based travel guides like Lonely Planet or by scouring thousands of small sites for recommendations from other travelers. But Kango wants to index these small sites and use semantic technology to detect what destinations and activities they cover, so someone looking for a family vacation in, say, Big Sur will see a different set of results than someone seeking romance or adventure.

Kango’s technology extracts the sentiment from the postings it indexes and only shows results for locations that get positive buzz. If you’re looking for activities, you can filter using a number of criteria, including theme parks, playgrounds, wineries and breweries, and spas.

In its current state, Kango only supports California and Hawaii and doesn’t expand beyond “family friendly” and “romantic.” The ability to search for “pet friendly, “historical,” “eco-friendly” and “thrill-seeking” destinations and activities is planned for later releases.

The company’s founder Yen Lee, who was a general manager for Yahoo Travel, has an insider’s perspective on the limitations of the online travel market and has used what he learned at Yahoo Travel to build a technology with a refreshing spin on travel search. With all of the money and brainpower behind online travel sites, it’s surprising something like Kango hasn’t come along sooner.

That said, getting users to visit yet another site as part of their travel planning process will be no mean feat. Once it’s fleshed out, it’d be great to see Kango’s services integrated into a larger platform that handles ticket search, booking, and TripIt’s central organization from one beautiful interface.

See our first mention of Kango here (scroll down).