Online Spending On Travel To Reach $128 BillionOnline Spending On Travel To Reach $128 Billion

Online spending on travel is expected to reach $128 billion by 2011, driven by better products available over the Web, higher spending by consumers, and improvements in meeting the needs of businesses, a market research firm said Monday.

Online travel revenue is expected to reach $85 billion this year, increasing by about 50% in five years, JupiterResearch said. By 2011, 38% of travel revenue will come from the Web.

"Factors that will spur online spending are greater consumer wallet share, increasingly sophisticated products available online, and improved online compliance in business travel," JupiterResearch analyst Diane Clarkson said in a statement.

Higher fares and an increase in people flying are expected to drive total airline revenue to $138 billion this year, with $49 billion of that spent online. The online revenue from air travel is expected to grow to $72 billion in 2011.

During that timeframe, hotels are expected to continue seeing a shift of sales from telephone reservations to Web sites, the firm said. In addition, JupiterResearch said it's seeing a shift in buyers' preference from third-party Web sites to those of the actual suppliers.