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Video: Are travel websites and hotels fixing prices?

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    >>> back now at 7:40. this morning rossen reports, consumer alert for anyone that uses internet to book vacations, are prices at some hotels fixed so you pay more. correspondent jeff rossen here with this story. good morning to you.

    >> i know you, myself, we all want a great deal. when booking a trip you go online and shop around for the best price , expedia, travelocity. now big accusations of price fixing at the travel website and biggest hotel chains are scheming together so you don't get a deal no matter how hard you look.

    >> price line negotiator.

    >> get the travelocity guarantee anywhere when you book with our new app.

    >> the kplergss are convincing.

    >> where you book matters, expedia.

    >> reporter: their promise, use our website and you'll get the best deal out there. from the travelocity guarantee to expedia's best price . and the orbitz hot hotel deals.

    >> when i go only, i'm looking for a bargain and a deal.

    >> obviously i care about the price because the cheaper it is, the better.

    >> but this new lawsuit claims you're wasting your time, accusing the biggest travel sites, the ones we all use, of conspiring with the country's most popular hotel chains to fix the prices of rooms so you can't get a lower rate online. attorney steve burman filed the suit on behalf of customers.

    >> this is the industry's dirties little secret, they are not offering a lower price , they are offering a fixed higher price .

    >> reporter: the lawsuit claims it's an anti-competitive scheme. instead of these websites having price wars , which is good for the consumer, they have all agreed to sell the same rooms at the same price . that way the sites don't undercut each other and they all profit.

    >> the winner herert internet travel companies and the losers are the consumers.

    >> reporter: here is an example. say i want to book a room at the san diego hotel . watch what happens when i price the same room, refundable king, on five different sites. we'll start here on expedia. the rate $189. on travelocity, $189. orbitz, the rate here, $189. and it's the same price on booking.com and hotels.com.

    >> the consumer is led to believe if he or she looks thank you whole bunch of websites, you're going to find the best deal. the fact is that's a sham. there is really no best deal, it's all the same deal.

    >> reporter: the hotel chains deny breaking the law and say they will fight the suit as does orbitz, misrepresents how hotel reservations are marketed online. travelocity denies any anti-competitive behavior. the others declined to comment.

    >> the effect on consumers, they are being deceived and overpaid for their hotel rooms .

    >> the lawsuit demands money back for customers and a stop to the alleged price fixing . in the meantime, travel experts say before you book online, you should just call the hotel itself, tell them on the phone, hey, this is the lowest rate i'm finding. can you do any better. savannah, sometimes the hotel if they have extra rooms available will over the phone grant you a lower rate.

    >> worth a call.

By
TODAY
updated 8/24/2012 7:41:15 AM ET 2012-08-24T11:41:15

A consumer alert for all of us who book vacations online: Are the prices at hotels fixed so you pay more and don't get a deal? TODAY National Investigative Correspondent Jeff Rossen looked into it.

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We all want a great deal. So when you're booking a trip, you go online and shop around for the best price: Expedia, Travelocity, Orbitz. But now, big accusations of price-fixing — that the travel websites and hotel chains are scheming together so you don't get a deal, no matter how hard you look.

Have an idea for Rossen Reports? Email us by clicking here!

The commercials are convincing: Use our website and you'll get the best deal out there. From the Travelocity guarantee to Expedia's "best price" and the Orbitz "hot hotel deals."

But a new lawsuit claims you're wasting your time, accusing the biggest travel sites of conspiring with the nation's most popular hotel chains to fix the prices of rooms so you can't get a lower rate online. Attorney Steve Berman filed the suit on behalf of customers.

"This is the industry's dirty little secret," Berman said. "They're not offering the lowest price or the best price, they're offering a fixed higher price."

Story: Rossen Reports: Are you getting what you pay for at the pump?

The lawsuit claims it's an "anti-competitive scheme": Instead of these sites having price wars, which is good for the consumer, they've all agreed to sell rooms at the same price. That way, the sites don't undercut each other, and they all profit.

"The winner here are the Internet travel companies, and the losers are consumers," Berman said.

Story: Rossen Reports: Are top websites in business with counterfeiters?

To see for ourselves, we looked up rates for a refundable king room at a San Diego hotel. On five different sites — Expedia, Travelocity, Orbitz, Booking.com and Hotels.com — we got the same price: $189.

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"The fact is that a consumer is led to believe that if he or she looks through a whole bunch of websites, you're gonna find the best deal," said Mark Orwoll of Travel + Leisure magazine. "The fact is, that's a sham because there is really no best deal. It's all the SAME deal."

Video: Are travel websites and hotels fixing prices? (on this page)

The hotel chains deny breaking the law and say they'll fight the suit, as does Orbitz, which says the case misrepresents how hotel reservations are marketed online. Travelocity denies any anti-competitive behavior. The others declined to comment or did not return our calls.

Read more investigative journalism from Rossen Reports

"The effect on consumers is they're being deceived, and they're overpaying on their hotel rooms," Berman said.

The lawsuit demands money back for customers, and a stop to the alleged price-fixing. In the meantime, experts say, before you book online, call the hotel itself. Tell them, "Hey, this is the lowest rate I'm finding — can you do better?" Sometimes, over the phone, they will.

To read statements from several companies in response to this report, click here .

Have an idea for a future edition of Rossen Reports? We want to hear from you! To send us your ideas, click here.

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