Value Blog Author Zeke Anders: The Prisoner's Dilemma of Consumer AI Agents and the Terminal Valuation Vulnerability of Online Travel Platforms
Value blog author Zeke Anders argues that the adoption of consumer AI agents creates a prisoner's dilemma—each online travel agency (OTA) or retailer has a short-term incentive to be the first to partner with agents to capture traffic, even though a collective blockade would serve long-term interests. Expedia has already been the first to integrate with Meta's Muse. Building on this, Anders points out that an approximately 15x price-to-earnings (P/E) ratio for OTAs implies extreme sensitivity in terminal value assumptions: if agent-mediated booking indeed occurs, about 80% of the current valuation foundation will be threatened. The author also admits his own judgment oscillates daily between 'changing everything' and 'just making things a little more convenient.'
Zeke Anders, author of the Value Blog Yet Another Value Blog, believes that the disruption posed by consumer AI agents to online travel platforms is almost inevitable given the game-theoretic structure, and that current valuations may not fully reflect this risk.
Anders' observation begins with a simple prisoner's dilemma: Imagine that both Expedia and Booking believe that consumer agents like Muse pose an existential threat to their businesses and therefore refuse to cooperate with them. This judgment might well be correct. However, if a large number of consumers are using Muse, either Expedia or Booking could capture significant business in the short term by being the first to lift the ban and becoming the default travel supplier for Muse. Yes, they are risking their long-term future, but the short-term returns would be highly attractive.
In fact, Expedia has already done exactly that. Anders notes that Expedia's integration with Muse is complete, and Expedia's stock has significantly outperformed Booking's over the past month. He acknowledges that a single stock does not constitute a trend, but he views this as the excess return deserved by the 'defector' in a prisoner's dilemma. The same logic can be extended to department store retailers: Macy's knows that agents will destroy its already struggling business, but if competitors all block agents, the retailer that cooperates first can reap a one-time windfall.