Full Description

Ctrip.com International, Ltd. (Ctrip) is a travel service provider for hotel accommodations, airline tickets and packaged tours in China. The Company also sells packaged tours that include transportation and accommodations, as well as guided tours in some instances. Ctrip targets its services primarily at business and leisure travelers in China who do not travel in groups. It acts as agent in substantially all of its transactions and does not take inventory risks with respect to the hotel rooms and airline tickets booked through the Company. The Company derives its hotel reservation, air-ticketing and packaged-tour revenues mainly through commissions from its travel suppliers, primarily based on the transaction value of the rooms, airline tickets and packaged-tour products, respectively, booked through its services.

As of December 31, 2008, the Company had secured room supply relationships with approximately 7,700 hotels in China and approximately 16,000 hotels abroad, which cover a range of hotels in terms of price and geographical location. During the year ended December 31, 2008, rooms booked in guaranteed allotment hotels accounted for approximately 85% of its hotel transactions. During 2008, revenues from its bookings for three-, four and five-star hotels comprised approximately 80% of the Company’s revenues from its hotel reservation business. The Company’s airline ticket suppliers include all major Chinese airlines and many international airlines that operate flights originating from China. The Company also offers independent leisure travelers bundled package-tour products, which include transportation and accommodations, as well as guided tours in some instances. Its package-tour products cover a variety of domestic and international destinations. During 2008, the Company derived 48% of its revenues from the hotel reservation business and 42% of its revenues from the air-ticketing business. In addition, it offers other products and services, including packaged tours, mostly bundled by the Company, that cover hotel, air tickets and transportation.

Hotel Reservations

The Company acts as agent in substantially all of its hotel-related transactions. It contracts with hotels for rooms under two agency models, the guaranteed allotment model and the on-request model. As of December 31, 2008, it had contracted with approximately 7,700 hotels in China, of which approximately 5,200 hotels have guaranteed room allotments, allowing the Company to sell rooms to its customers even during peak seasons and provide instant confirmation. Rooms booked in hotels, with which it has a guaranteed allotment arrangement account for a majority of its total hotel room transaction volume. With the remaining hotel suppliers, the Company books rooms on an on-request basis.

Air-ticketing

The Company sells air tickets for all major domestic Chinese airlines, including Air China, China Eastern Airlines, China Southern Airlines and Shanghai Airlines and many international airlines operating flights that originate from cities in China, such as United Airlines, Northwest Airlines, Air Canada, DragonAir and Lufthansa.

In air-ticketing transactions, a customer generally pays the ticket delivery agent upon delivery of the ticket. The customer also has the option of picking up a ticket at the ticketing office or obtaining an electronic ticket. In addition, the Company also provides E-ticketing services.

Packaged-tour

The Company offers independent leisure travelers bundled package-tour products, which include transportation and accommodations, as well as guided tours in some instance. Its package-tour products cover a variety of domestic and international destinations.

Other Products and Services

Ctrip offers travel-related businesses and other third parties the opportunity to advertise on its Websites. It sells travel guidebooks, which provide useful information for independent travelers. It provides air-ticket delivery and insurance services to its customers. The Company sells very important person (VIP) membership cards that allow cardholders to enjoy certain priority in obtaining its services and receiving discounts from many restaurants, clubs and bars in various cities in China. It also offers these membership cards free of charge to select customers who have purchased a certain amount of travel services from the Company.

The Company competes with eLong, Inc. and Mangocity.com.