European airlines to sell holidays online

Europe's top airlines aim to sell cheap flights and holidays direct on the internet – potentially stirring up a bruising fight with existing online travel companies.

A new website, called opodo.com, will be launched in Germany in December and in the UK a few weeks later, aiming to rival sites such as ebookers, lastminute.com, Expedia and Travelocity.

The site already has 128m euros (£75m) of backing from the nine airlines, though the company insisted that it will operate at "arm's length" from its shareholders.

A spokesman for lastminute.com warned that the company will watch carefully for any preferential treatment of Opodo by airlines. But he added, "If you were to ask people right now who or what Opodo is or does, they'd tell you it's a daft name – because that's what people do – and they'd tell you they've no idea what it does. Anyone entering this market has a mountain to climb for visibility; it's taken us a lot of work to get where we are. One of the biggest barriers for people trying to sell things over the Net is that of familiarity – if nobody's heard of you, they won't visit your site."

The Opodo sites will seek a slice of the online travel market, which is forecast to grow by 150 per cent annually from its present £3.7bn value worldwide to £24.9bn in 2005, according to the forecasting company Forrester Research.

Opodo aims to be a market leader – and to be profitable by 2004. By contrast lastminute.com, which gets most of its revenues from travel sales, plans to become profitable within 12 months, according to its own forecasts in May. Once that happens it might be able to push for greater visibility.