ResortQuest Hawaii, a mid-to-low end hotel chain popular with families, will become part of the Barry Diller empire, according to this PBN article. This continue along the path of Hawaii acquisitions for Expedia / IAC. Expedia bought Activity World in 2004, a Maui-based activity broker (snorkel cruises/hiking/scuba, etc) that was at the time the largest in the islands. Expedia also bought the parent of Classic Hawaii vacations in 2002, one of the largest tour packagers servicing Hawaii. Not that this means Hawaii can expect serious face time with Diller.

But it does beg an obvious quesiton. The travel market remains highly fragmented and inefficient. Diller is betting big on locking down key destinations by purchasing multiple pieces of the value chain. Will this strategy work? To a certain degree, it already has. Starwood has a huge chunk of the Hawaii market due to its extensive acquisitions of management contracts for hotels. And Hawaii, compared to other destinations, has precious few boutique or indie hotels or even the presence of up and coming indie chains like Kimpton.

—Alex, 04/21/07