Reservation powerhouse OpenTable will now provide restaurant reservations for one of its biggest competitors: IAC's Urbanspoon announced this afternoon that it will "partner" with the restaurant reservation service, allowing OpenTable to power its on-site reservations. As part of the deal, OpenTable will acquire the site's Rezbook reservation system, which was launched in 2010 as a more affordable alternative for restaurants setting up reservations systems online.
Many big-name restaurants, including NYC's Le Cirque and SF's Incanto, currently use the Rezbook service. According to the press release, some 2,000 restaurants currently using Rezbook will join the 20,000 restaurants under the OpenTable umbrella. OpenTable says it will continue to honor existing Rezbook contracts (including the Rezbook pricing), but Rezbook will not be available for new customers.
For the past few years, OpenTable's costly fees have come under fire from several restaurant owners; according to one report, it can cost a restaurant as much as $5 each time a table for two is booked through the OpenTable service. Urbanspoon's Rezbook launched with a significantly reduced monthly fee ($99 versus $270 on OpenTable, on average) and provided its services off an iPad, as opposed to custom hardware required by OpenTable.
OpenTable is now an even more dominant player in the online restaurant reservations game. Other competitors in the space include Livebookings, UReserve, and Scripps Networks' CityEats (which just launched a Chicago edition today). Back in 2010, OpenTable partnered with Yelp to offer reservations directly from restaurants' Yelp pages. But earlier this month Yelp announced the acquisition of SeatMe, a low-cost OpenTable competitor. As noted in that press release, the OpenTable agreement could "restrict its ability to fully integrate SeatMe." Developing.
The full press release, below:
OpenTable Partners with Urbanspoon; Acquires Rezbook
OpenTable named restaurant reservations provider for Urbanspoon
SAN FRANCISCO – July 31, 2013 – OpenTable, Inc. (NASDAQ: OPEN), the world's leading provider of online restaurant reservations, today announced that it has been named the provider of restaurant reservations in North America for Urbanspoon, an operating business of IAC (NASDAQ: IACI). The company also announced that it has acquired Rezbook, Urbanspoon's reservation management system for restaurants. Terms of the deal were not disclosed.
"We're looking forward to introducing more diners to the convenience of online booking by powering reservations across our more than 20,000 restaurants on the Urbanspoon site and mobile apps," said Matt Roberts, Chief Executive Officer of OpenTable. "We're also excited about welcoming Rezbook and its approximately 2,000 restaurant customers to the OpenTable family."
The OpenTable network connects restaurants and diners, helping diners discover and book the perfect table and helping restaurants deliver personalized hospitality to keep guests coming back. OpenTable seats more than 12 million diners per month via online bookings across more than 28,000 restaurant customers worldwide. OpenTable has experienced a growing number of diners who are choosing to book via mobile devices. In the first quarter of 2013, reservations booked on mobile devices accounted for 36 percent of the 34 million diners OpenTable seated in North America.
The acquisition will be recorded in the company's third quarter 2013 financial statements. OpenTable will update its third quarter and full year 2013 guidance when it reports second quarter 2013 financial results on Thursday August 1st.