Response by ADGAP to the latest news from VisitScotland
ADGAP is pleased to see the acknowledgement in the press release by VS of problems in the way that the business has been operated for the past 4 years. We will watch the developments with interest but remain very concerned that the "Scotland" brand no longer belongs to Scotland and its people. Our campaign to reclaim VS.com will continue via this site and we encourage all who care about the future of Scottish tourism to sign up with their support.
Despite VisitScotland's strenuous efforts to put a positive spin on the dramatic changes to the make-up of eTourism Ltd, providers should look to the underlying story; it seems clear that the company must have reached effective insolvency, surviving only by financial support from the majority shareholder, Atos Origin. We believe that, to avoid an embarrassing failure, a deal has been struck with Tiscover, (an Austrian-based company already involved in tourism websites), involving transfer of shares at nil value, in return for a large (though unspecified) injection of funds.
Although VisitScotland has acquired additional shares in the process (free of charge), the balance of power is unchanged with the private partners, Tiscover, Atos & PUK holding around two thirds. Clearly Tiscover would not have been prepared to invest without the prospect of future profits. We believe that the only way this could be achieved would be if a much higher level of displacement of business from providers were to occur. Questions also remain as to whether the £7.5m start-up loan is still outstanding. Talk of industry participation and an independent chairman may well turn out to be palliative measures designed to counteract opposition to changes detrimental to providers, but if invited to participate, ADGAP is prepared to do so proactively. ADGAP will monitor the situation as it develops to keep members informed.
Why is Etourism Ltd Harmful To Scottish Tourism?
To benefit tourism, the national website should sell Scotland, the destination, by showcasing our unique tourism product. It should promote all accommodation providers and facilitate contact with them. Under the control of eTourism the main function of the website is to sell accommodation. To maximise sales, direct contact between consumer and business is obstructed. Pressure selling precipitates bookings at the expense of customer satisfaction. Commission charges increase costs to providers who pass them on to the consumer as price rises. Increased prices result in reduced volume of business overall. Emphasis on the website is room sales - Scotland as a destination comes second. eTourism has no interest in attracting new tourists to Scotland as it costs less to close sales to people already committed to holidaying in Scotland.
What is the Solution?
The National Website must be taken back into Public Sector control to remove the commercial element which is corrupting its proper operation.
How can Tourism Businesses Help?
By signing the Scottish Parliament petition, lobbying MSPs and joining forces with other affected businesses to support a national campaign.
Background to the Private Public Partnership eTourism Ltd. (visitscotland.com)
eTourism Ltd was set up by the Scottish Executive in 2002 as a Private Public Partnership to run a website and booking system as a commercial enterprise. Originally Area Tourist Boards and VisitScotland were allocated shares to a total of 25% of the Company via an organisation called Tourco. Partnerships UK were allocated 15% and SchlumbergerSema 60%. Subsequently, SchlumbergerSema was taken over by Atos Origin. When Area Tourist Boards were abolished, their shareholding was transferred to VisitScotland. The company was set up by means of a £7.5M loan in proportion to each party's shareholding.