What Is an OTA?

An OTA, or online travel agency, is a website or app where travelers search, compare and book hotels, flights and other travel, and the hotel pays the OTA a commission on each completed stay. Booking.com, Expedia and Agoda are the largest examples. For most hotels, OTAs are the biggest source of bookings that do not come through the hotel's own website.

Last updated: October 2026

How an OTA works

A hotel signs an agreement with the OTA, loads its rooms, rates and availability, and the OTA lists them next to thousands of other properties. When a guest books, the OTA passes the reservation to the hotel and takes its commission. Booking.com charges commission on completed stays, on non-refundable and late-cancellation charges, and on no-shows, and invoices the hotel monthly. The percentage varies by country and property type and is set in the hotel's contract. Booking.com Partner Help

Who collects the guest's money depends on the model. Under the agency model, the guest pays the hotel at the property and the hotel pays the OTA its commission afterwards. Under the merchant model, the OTA collects the full payment from the guest at booking and pays the hotel the room price minus its fee. Expedia calls these Hotel Collect and Expedia Collect. Expedia Group partner terms Booking Holdings has been moving its business toward the merchant model: in 2025, merchant gross bookings grew 24.8% to $130.0 billion while agency gross bookings fell 8.7% to $56.1 billion. Booking Holdings Q4 2025 results

Booking Holdings sold 1.235 billion room nights in 2025 on $186.1 billion of gross bookings. Expedia Group booked 415 million room nights on $119.6 billion. Expedia Group Q4 2025 results Airbnb, which began signing boutique and independent hotels directly in late 2025, reported $91.3 billion in gross booking value across 533 million nights and experience seats booked. Airbnb Q4 2025 shareholder letter

Why OTAs matter for hotel distribution

OTAs are where a large share of guests start. In Europe, OTAs delivered 29.9% of hotel overnights in 2025, up from 19.7% in 2013, and Booking Holdings alone handled 68.8% of European OTA bookings. Direct bookings, including phone, email and the hotel's own website, still made up 51.3%. HOTREC European Hotel Distribution Study 2026 In the United States, OTAs account for about one fifth of all travel gross bookings, and hotels make up 63% of what OTAs sell. Phocuswright, July 2026

An OTA listing also helps the bookings that never touch the OTA. Cornell's Chris Anderson found in 2009 that listing four hotels on Expedia raised their non-OTA reservations by 7.5% to 26%, an effect he called the billboard effect. Cornell Center for Hospitality Research, 2009 A 2017 follow-up found that about three quarters of guests who booked direct with a major brand had visited an OTA first, and concluded the effect still holds. Anderson and Han, 2017

The cost is the commission and the loss of the guest relationship. The guest's payment details, email and preferences often sit with the OTA rather than the hotel. That is why most hotels treat OTAs as one channel among several and keep working on direct bookings at the same time.

One rule that used to come with OTA contracts has changed in Europe. Rate parity clauses required a hotel to offer the OTA its lowest public rate. Since the EU's Digital Markets Act applied to Booking.com in November 2024, hotels in the EU may set different prices and conditions on other channels, including their own website. In the United States there is no federal rule, and narrow parity clauses remain common in contracts. European Commission, DMA factsheet

OTAs compared with other channels

Metasearch sites show rates from several OTAs and from the hotel's own site, then send the traveller to whichever one they choose to book on; the metasearch site never holds the reservation itself. Google's paid hotel ads are ranked by auction; its free booking links are ranked by usefulness and cost the hotel nothing. Google Hotel Center Help A bed bank or wholesaler is different again: it buys rooms at a net rate and resells them to OTAs and agencies at a markup. HotelMinder

OTAs compared with other channels

  OTA GDS (global
distribution
system)		 Metasearch Direct booking
engine
Examples Booking.com,
Expedia, Agoda		 Amadeus, Sabre,
Travelport		 Google Hotel Ads,
Trivago, Kayak		 The hotel’s own
website
Who books there Consumers Travel agents and
corporate bookers		 Consumers, who are
sent elsewhere to book		 Consumers
How the hotel
pays		 Commission per
stay		 Commission plus
transaction fees		 Per click or per
booking ad spend; Google’s
free booking links
cost nothing		 Booking engine
software fee
Who owns the
guest		 Mostly the OTA The agency The channel the
guest books on		 The hotel

Frequently asked questions

What does OTA stand for?
Online travel agency. In hotel conversations, "the OTAs" usually means Booking.com and Expedia and their sister brands, which together handled 85.4% of European OTA bookings in 2025.
How much commission do OTAs charge hotels?
It depends on the OTA, the country and the contract. Booking.com says its percentage varies by country, property type and location, and does not publish a standard rate. Check your own agreement; the number in it is the only one that counts.
Is Airbnb an OTA?
Airbnb started as a marketplace for private homes rather than a travel agency, but hotels now list rooms there and it takes a fee on each booking, so for a hotel it behaves like one more channel. In late 2025 Airbnb began partnering directly with boutique and independent hotels in several cities.
What is the difference between an OTA and a GDS?
A GDS, or global distribution system, sells to travel agents and corporate booking tools rather than to the public; an OTA sells to travellers directly. Both list the hotel's rates and availability, and both charge the hotel for the bookings they bring, though a GDS usually adds per-transaction fees on top of commission.
Should a hotel be on more than one OTA?
Most are. Each OTA has its own audience by country and by traveller type, and being listed on several widens reach. The work is keeping rates and availability identical everywhere, which is the job of a channel manager.
Do OTAs hurt direct bookings?
For visibility, the research points the other way: the billboard effect shows that an OTA listing lifts the bookings a hotel receives through its own channels. The real costs are the commission and the guest data the OTA keeps, which is why hotels balance OTA reach against their direct channel.

Related terms

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Where Jetstream fits

Most hotels sell through several OTAs at once, alongside their own website and other channels, and every one of them needs the same rooms, rates and availability kept current. When those drift apart, the hotel risks overbookings, rate parity problems and lost bookings. Jetstream builds distribution technology that connects a property's reservation system to the channels where guests book and keeps its inventory accurate on each of them, so the team can run distribution from one place.

See Jetstream's AI channel manager Book a demo