What an OTA commission actually costs
Online travel agents (OTAs) are genuinely useful for discovery — a new hotel with no reputation yet can get found by travelers searching a city for the first time. That visibility comes at a price: a commission on every booking made through the platform, typically somewhere in the 15-25% range depending on the OTA, room category and any negotiated rate. On a ₹2,000 room night at 18% commission, that's ₹360 gone before the hotel accounts for a single other expense.
The commission isn't the only cost, either. Rate parity clauses in most OTA contracts restrict how much cheaper a hotel can price its own direct channel, and payouts typically settle on a delay rather than at the time of stay.
Why direct booking is different
A direct booking — a guest reserving through the hotel's own booking page rather than an OTA listing — doesn't carry that same per-booking commission. The hotel still needs somewhere for that guest to land: a bookable page, real-time room availability, and ideally an online check-in flow so the experience doesn't feel like a step backward from the OTA the guest is used to.
This doesn't mean dropping OTA listings — most hotels still want that discovery reach. It means capturing the bookings that don't need discovery: returning guests, word-of-mouth referrals, and guests who found the hotel on an OTA once and would happily book direct next time if given an easy way to.
Working out the number for your own hotel
The calculation is simple once you have your own two inputs:
| Input | Where to find it |
|---|---|
| Monthly revenue booked via OTAs | Your OTA extranet payout reports |
| Commission rate charged | Your OTA contract or extranet commission statement |
Multiply the two to get monthly commission paid, then multiply by 12 for an annual figure. Compare that against the flat monthly cost of a direct-booking-capable PMS — the gap is what's genuinely at stake, not a marketing estimate.
The realistic goal
Direct booking is rarely an all-or-nothing switch. The realistic goal for most independent hotels is shifting the share of bookings that don't need OTA discovery — repeat stays, referrals, walk-ins who'd rather book online than queue — onto a direct channel, while keeping OTA listings for what they're actually good at: bringing in guests who've never heard of the hotel before.
See how Orajic HMS handles both sides — a channel manager for OTA rates and availability, and a direct booking page with online check-in for everything else.