Years ago, the travel industry was controlled by a few large travel companies that booked holidays, air tickets, bus tickets, and hotels for their customers. However, with the emergence of the internet, smaller travel agencies started mushrooming in the industry and customers started making their own reservations. Which of the following can be inferred from this information?
A) The travel industry changed from a consolidated structure to a fragmented one.
B) The pricing power of the incumbent firms in the travel industry has increased.
C) The bargaining power of buyers in the travel industry has decreased.
D) The structure of the travel industry changed from monopolistic competition to an oligopolistic one.

Question

Quizplus · Accepted Answer

A consolidated industry structures may break up and become more fragmented. This generally happens when there are external shocks to an industry such as deregulation, new legislation, technological innovation, or globalization.

Years Ago, the Travel Industry Was Controlled by a Few