The OTA Lesson DMOs Forgot

In 1996, Expedia and Travelocity launched—and we all watched travel agents disappear. Here's the problem: we drew exactly the wrong conclusion from what happened next.

The conventional wisdom says OTAs killed travel agents. It's a clean story. Internet comes along, consumers book direct, travel agents become obsolete. Except that's not what actually happened. And if you don't understand what really went down between 1996 and 2010, you're about to repeat the mistake with AI.

OTAs Didn't Kill Travel Agents. They Killed Generalist Travel Agents.

Here's what nobody talks about: There are still 65,000 travel agents in the United States right now. The profession didn't die—it evolved. The agents who disappeared were the ones whose entire value proposition was access to a booking terminal and the ability to issue a ticket. The moment consumers could do that themselves? Gone.

But look at what survived. Virtuoso—the luxury travel network—went from 1,500 attendees at their annual conference in 2000 to over 5,000 by 2016. Their advisor count grew from 17,500 in 2018 to over 20,000 today. That growth happened after OTAs dominated, not before. These weren't refugees from a dying industry. They were entering an evolved profession.

The commission collapse tells the real story. In February 1995, Delta capped commissions at $50 roundtrip. Within days, every major carrier followed. By 2002, eight of the ten largest airlines had eliminated base commissions entirely. The generalists couldn't survive on fees alone. But the specialists? They were already charging for expertise, not ticket issuance. The collapse didn't kill them—it validated their model.

The Forcing Function Nobody Appreciates

Here's the counterintuitive truth: OTA disruption was the best thing that ever happened to the travel agent profession.

Without that pressure, generalist agents would have limped along at declining margins for decades. No urgency to develop real expertise. No reason to specialize. The profession would have stagnated—and then AI agents would have arrived to find an undifferentiated workforce with nothing defensible to offer.

Instead? The 2000s forced painful but necessary evolution. The survivors developed genuine, defensible expertise. The Travel Institute launched specialist certification programs in 2003—adventure, luxury, honeymoon, diving, wellness. Virtuoso explicitly rebranded from "Allied Percival International" to signal their "evolution from transactional to advisory role." The industry didn't just survive commoditization. It used commoditization to level up.

This Is Exactly What's About to Happen to DMOs

AI agents are going to do to your website what OTAs did to generalist travel agents. The commodity work—basic trip discovery, comparison shopping, standard itinerary building—will be absorbed by machines. And just like in 1996, most of the industry is going to interpret this as existential threat when it's actually evolutionary pressure.

Think about it: What's your DMO's equivalent of "booking a flight"? The commodity function that any AI can replicate? It's probably most of what your website does right now. The photo galleries. The event listings. The "things to do" pages. All of it scraped, synthesized, and delivered by an AI agent in three seconds without anyone ever clicking through to your domain.

That part of your job is going away. Not in ten years. Now.

But Here's What AI Can't Replicate

The travel agents who thrived post-OTA had something the booking systems couldn't touch: hyperlocal knowledge that couldn't be scraped, relationships that took years to build, and quality judgment that required actual expertise.

They knew which restaurants actually delivered versus coasted on reputation. They had direct lines to general managers for problem resolution. They could look at an itinerary and know instantly whether the pacing was wrong for a family with young kids. They had allocation access during high-demand periods that no amount of algorithm could unlock.

Sound familiar? That's what your DMO should be building toward. Not prettier websites. Not better SEO. The irreplaceable stuff. The relationships with member businesses that give you real-time intelligence. The local expertise that tells agents which hidden gems actually deliver. The quality curation that separates the tourist traps from the transformative experiences.

The travel agents who survived figured out how to package expertise, not transactions. DMOs need to do the same thing—fast.

The Question You Need to Answer

What's your DMO's equivalent of "generalist booking services"—the commodity work that AI will absorb first? Because whatever that is, it's already being eaten. The only question is whether you're going to spend the next three years defending it or pivoting to something defensible.

The survivors of OTA disruption didn't win by building better booking terminals. They won by becoming essential in ways booking terminals couldn't replicate. That's your playbook. The clock's already running.