Booking Holdings CEO Glenn D. Fogel at Semafor Tech: First Principles

Well, thanks for having me.

I'm doing excellent. A little tired. Travel's been interesting in the last couple days, but that's part of the beauty of AI. We'll be able to fix all of these problems.

Well, so many ways and it is interesting. I think everybody here, if I asked you, 'Have you had any frustration in travel?' I am certain every single hand would go up, of course. And when you look at it, it's unfortunate because you think this is the perfect place where something like AI should make things so much better. And it will and it is already making it so much better, but there's so much more to do. It's certainly the bringing together all these different systems is incredibly difficult to do and important. But what's interesting to me sometimes, particularly in this part of the world, is maybe it's a lack of understanding of how complex travel really is. A lot of people don't realize behind when they're putting together their travel plans, the incredible issues you have to deal with behind the scenes. And that's where AI really will help. So, people see the front, 'Oh, it's going to help me know where to go, what's doing all that.' But actually putting together, piecing together, there's so many permutations. If you actually worked it out yourself, you have a family of four, you want to do travel, you want to go couple places, maybe, and what are we going to do, and how do we get there, and when we do get there, if there's any problem, how's it going to be fixed, and all that. That stuff people don't think about a lot, but that's something that we're thinking about all the time. And I am certain that using the Connected Trip, being with that one point of contact that knows you, that personalizes what you need and your family or your friends, what you really will be optimal for you, is going to be a great step forward.

You mean like the creepy factor?

The creepiness factor, right? Yeah. No, that's definitely an issue. And certainly you look at your trust. If you trust your doctor, then you'll tell your doctor incredibly intimate things, because that's going to give you better service, and you feel that relationship, right?

At the other end of the spectrum is you don't go up to any stranger and just start handing over your Social Security number for any particular reason. And where in travel should this relationship be, and how do you build that trust over time that yeah, you know me, and it's okay that you know me because you provide a better service for me. And that's one of the issues why we believe one of these Booking Holdings has a very well-known trustworthy brand. And that goes in the whole area of what is brand. Brand can be building up that trust factor. I trust it because I know they will treat my information correctly, that they will do everything right, that if something goes wrong, they will fix it for me. That's what we have to continue to build on, which we believe we have a good base, a very good foundation, but continue. And here's the biggest issue. It takes forever to really build incredible trust. It only takes a moment to break it. And that's something that we are very aware of. And AI, it just makes it that much bigger because the use of that information can be so much more destructive if used improperly.

Yeah, it's really complex and I've talked about it a lot because I see it happening. It's happened forever. Technological changes, new tools come in, people are more efficient. Businesses find that well, that role is now being supplemented or even replaced by technology. So you either need fewer people or no people. And what happens to those people? Now, the economists will say, and correctly so, that the net benefit to society are great. And that's true over time. But if you're the person being replaced, you don't feel that way at all. Let me ask you guys. How many of you have been fired? A notebook. Yeah, I'm going to hold my hand up because I've been fired. Okay? It sucks. It's really bad, especially if you're fired. I'll give you hold up. You didn't do anything wrong. You were a good worker. Okay, you were a good worker. You did everything right and your job was eliminated. And that really really sucks. And we see that all the time. So, our company, we do over well, I think now it's over 40 languages maybe yeah, I don't know. Incredible number of languages. We used to do the content translated and everything was translated by humans. This is 20 years ago. We had thousands of translators doing it. Okay, how many translators do you think we have now? I don't think we have any. What happened to them? Where did their jobs go? Well, that's going to happen a lot more. What is our responsibility as a company to help develop people so even if their role is reduced or eliminated that they have gotten what they should have gotten besides a paycheck. And that's why I'm talking to my CHRO all the time to make sure every single person, 25,000 employees, every single one of them is AI literate as possible given their education, given their make it so that they are able to gain from AI personally, their own futures, etc. One. Two. Make sure that if we do have to make changes that we're giving the opportunities for other roles, other things. Can they move from where they are to something else? But we as one company, we can't do it just by ourselves. There's something that's much more important for governments to take the lead in how are we going to deal with this very rapid change. Look, it's happening all the time. Midwest and the changes in industry, the steel industry or you go down to furniture making in the south, southeast or any part of the world. There's this change has always happened and new jobs are created. That we got that. But how do we handle the people in the middle? I just saw that Pepsi's got trucks now that are delivering completely autonomous. Anybody see that? Okay, you're a truck driver. Let's say you're driving an 18-wheeler. You're making a pretty good living. Not a bad job, good job. And you didn't need a lot of education for that at all. Well, when all those trucks are automated, what's going to happen here? A 50-year-old person? What's going to happen to you? And we have to be thinking real hard about that because the rate of change has accelerated so much. And when there is such accelerated change, there can be societal disruption. There can be turbulence. And we should get ahead of that before it happens.

220 countries and territories. We like the number to be as big as possible, so we count places like Puerto Rico separate because it's kind of part of the US, but not. So, we just added on.

Well, and that's why we'll see some of our great companies here in the Bay Area are not allowing some of their services in other parts of the world because the regulations don't allow or they're concerned about that. It is a very complicated issue. And the whole thing now with the EU coming out with their idea of technological sovereignty they want. And of course, most countries around the world are thinking about these issues. So, it's data sovereignty. It's not being dependent on others. So, what about the whole issue of technology and the issue of money flows? And people now concerned if any one country can have control over the issue of payments. These things are so complex, privacy that we deal with. That's why it's not so simple to just replace global companies such as ourselves that have been in the business for, you know, I've now my 27th year of building these up, so we know what the rules are in this part of the world, and we know how to do it legally, correctly, and obey all the and over there we can do. The idea that some 17-year-old is going to write code or replace an for booking is just so preposterous. But yet some people actually think this.

The truth of the matter is, when you see the money and the numbers being thrown around, anybody can replace anything. If one of the large frontier model owners decide, 'Yeah, instead of spending $100 billion on that, we're going to spend $100 billion replacing the steel industry.' They could do that. Of course, it'd be a really dumb use of the money, a terrible thing to do. So, the reason we believe that we have a competitive advantage or at least it makes more sense for us to do what we're doing, which is partnering with all the most advanced players in the space, creating what we do best and what they do best, and creating something better for both of us. So, yeah, in the end there is no such thing as a universal moat. There's nothing. Nobody has that. But, if you continue to evolve, continue to make it better, continue to do what your expertise is better than what somebody else can and certainly more efficient in that they can create economic value by the combination, which is what we're doing. That is the way we'll continue to thrive as we have had with all the changes that have happened and there have been a lot. Gen AI ain't just the first time something new has happened as we've been able to do over the last more than two dozen years.

Thank you.