FlyLAL chafes at airBaltic's market dominance

  • 2007-09-19
  • By TBT staff
VILNIUS - Lithuania's FlyLAL has accused its Latvia-based rival, airBaltic, of unfair competition by "hijacking" the Lithuanian carrier's name on Google, an accusation that the Latvian flier has dismissed as absurd. 
According to FlyLAL officials, a search for FlyLAL on Google resulted in airBaltic coming up as the first site. FlyLAL said it would ask airBaltic to compensate it for lost revenue to the tune of 5 million litas (1.5 million euros).
"Such actions by the Latvian air carrier airBaltic … are a gross violation of the principles of fair business practices and of FlyLAL's exclusive rights to the use of the name of the company and the brand name," Tadas Puksta, CEO of FlyLAL-Lithuanian Airlines, said in a statement issued Sept. 12.
"We calculated that these dishonest actions by our competitors could have cost us up to 5 million litas in lost revenue."

Puksta said that flyLAL, which is owned by three private Lithuanian companies, "expects that airBaltic will immediately stop the unfair practices and will adhere to the basic principles of fair business practices in the future." If the Latvian competitor refused, FlyLAL would take the matter to court.
AirBaltic dismissed the accusation as utterly ungrounded and challenged anyone to type in "FlyLAL" in Google to see what would come up as the most relevant site.
Spokesman Janis Vanags said that airBaltic did have a sponsored ad in Google and that some searches that use a number of keywords involving flying could result in the Latvian carrier's name appearing. "Someone should explain to FlyLAL how Google searches work," he said.
Sponsored ads can appear in Google either at the top of the page against a blue background or to the right side of the screen in a separate column. 

Vanags said the fuss simply boiled down to the fact that airBaltic offers consumers a better service 's in terms of both price and destinations 's than its competitors, who are struggling to keep up.
Indeed, in August an association of Latvian travel agents filed a complaint with competition authorities claiming that airBaltic was offering its cheapest tickets on the Internet and was encouraging consumers to buy online.
Since airBaltic launched flights to and from Vilnius after EU accession in 2004, the two airlines have competed head-to-head in the Lithuanian market. AirBaltic eventually overtook the struggling FlyLAL as the dominant carrier at Vilnius Airport and continues to consolidate its leading position.

The Latvian airline handled 376,000 passengers at Vilnius Airport during the first eight months of 2007, up 27 percent year-on-year. In August alone, the carrier recorded 31 percent year-on-year growth, the company said Sept. 13.