The looming sale of Starwood was no secret. The only unanswered question was to whom. And this week Marriott emerged victorious although industry rumours of a possible counter bid persist.
The name of Starwood's purchaser is probably not what's important. What is, however, is that supplier consolidation is well and truly on the march.
Speaking in Dublin last week, Ryanair CEO Michael O'Leary predicted that there would shortly be only three major global airlines. His reasoning is that British Airways, Air France KLM and Lufthansa already each have an American partner so it is only a matter of time before the competition they are seeking to keep out of Europe, namely the Gulf carriers, all take stakes in the European legacy carriers and — voilà — we have only three axes.
In fact there have been three major airline alliances for about 20 years and 20 years ago senior airline figures were predicting that there would be only five major carriers in 20 years' time.
The long-anticipated sale of Starwood is, similarly, another step in the seemingly inevitable consolidation of the global hotel suppliers because hotel companies ultimately need to make money.
More scale lowers back office costs. And that includes distribution. With this magnitude of volume and range of brands a hotel company virtually replicates an OTA in terms of choice. And this supports a strategy geared at growing direct distribution.
Given the amounts of commission leaking to OTAs, all hotel groups want to increase the proportion of their business coming direct and Marriott is at the forefront. Marriott.com generated $10 billion in gross bookings in 2014, a figure that is growing fast.
And direct distribution works for corporates. The process can identify the corporate customer and, in theory, give access to the range of inventory at the negotiated rate along with recognition and soft benefits to the travellers.
Supply and the total number of suppliers is not diminishing. Many new players, from small 'design' properties to Airbnb, have become part of corporate travel programmes. Most of the growth in supply is not in the standard bedrooms with guest support services hotel model but in specific niches that either support global providers (eg limited service brands) or appeal to a segment of global companies' travellers (eg Airbnb).
Corporate travel programmes no longer need to be solely with one kind of brand or company. Although a portfolio of brands to offer options for different markets, travellers and purposes of travel is currently a popular model and fulfils personalised demand, no one expects Marriott and Starwood's combined 27 brands to survive unscathed in the new company.
Demand is not just about style. As Conrad Hilton famously said, it's about "Location, location, location" and Starwood's portfolio will undoubtedly fast-track Marriott's presence in some areas such regions of China.
There has been a long-standing belief in business that global companies like doing business with other global companies. That might be true but in the travel space there are going to be more global brands but fewer global players.
And big players can develop direct distribution.