AmEx Acquires LoungeBuddy

Old Mar 11, 19, 10:31 am
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AmEx Acquires LoungeBuddy

Amex announced today that they are acquiring the Loungebuddy app. They had already done a lot of integrations with LB for their 'find a lounge' service in the AmEx app, so it makes sense that they would go for a full acquisition: https://about.americanexpress.com/pr...re-loungebuddy
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Old Mar 11, 19, 12:03 pm
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Sounds like another enhancement. Proud to be a cardholder. Not sure where this will go quite yet, but I have no doubt good things. Amex is taking the lounge network very seriously, as they should. It helps keep me very loyal to them.
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Old Mar 11, 19, 1:18 pm
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Originally Posted by cfabar1 View Post
Sounds like another enhancement. Proud to be a cardholder. Not sure where this will go quite yet, but I have no doubt good things. Amex is taking the lounge network very seriously, as they should. It helps keep me very loyal to them.
Interesting how differently people can view the same news. My immediate gut reaction was, "great, even more ways for even more people to get into already overflowing lounges..."

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Old Mar 11, 19, 2:18 pm
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I can see how you'd feel that way, but I do think AMEX and Delta both (the two networks I am most familiar with regarding lounges) have worked to limit lounge access to ensure the access for those who are members is becoming more peaceful and calm than say a year ago.

Of course next time there's a recession I'm sure day passes and less stringent access policies will return.
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Old Mar 11, 19, 2:39 pm
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I'm wondering where AmEx is going with this. It could be as simple as LoungeBuddy was not surviving on its own and would have shut down if Amex didn't buy it for a song. I wonder if it has more to do with a combination of advertising and data - the people looking for lounges likely are in the AmEx target demographic of affluent upper-middle and lower-upper class and AmEx can now advertise to them for free, and the data could be as simple as seeing where people are looking for lounges the most, where they leave the poorest reviews, and generally find places to better target Centurion openings.
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Old Mar 11, 19, 4:34 pm
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Originally Posted by lowfareair View Post
I'm wondering where AmEx is going with this. It could be as simple as LoungeBuddy was not surviving on its own and would have shut down if Amex didn't buy it for a song. I wonder if it has more to do with a combination of advertising and data - the people looking for lounges likely are in the AmEx target demographic of affluent upper-middle and lower-upper class and AmEx can now advertise to them for free, and the data could be as simple as seeing where people are looking for lounges the most, where they leave the poorest reviews, and generally find places to better target Centurion openings.
I'm hopeful that this just translates into a larger footprint - they could leverage the discounts that LB already has with certain non-PP lounges to provide Plat/Cent access, or even a Plat/Cent discount off of the "normal" price. I also saw elsewhere (don't remember where) a suggestion that they could start offering discounted "day passes" at the same price as before as a benefit to all Amex cardholders, when in reality it was previously available to everyone. Doing so could both reduce crowding in those lounges and allow the lower-level Amex cards to have some semblance of lounge benefit, much like a lot of overseas cards have limited (e.g. 10x a year) PP access.
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Old Mar 11, 19, 4:44 pm
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My take, just a purchase of a digital platform. Most likely cheaper to buy then continue to license from Lounge Buddy.
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Old Mar 13, 19, 6:51 am
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What are the odds that Amex decides to discontinue PP and redirect card holders to discounted pay per use via lounge buddy with this acquisition.
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Old Mar 13, 19, 9:12 am
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Originally Posted by MT_Switch View Post
What are the odds that Amex decides to discontinue PP and redirect card holders to discounted pay per use via lounge buddy with this acquisition.
I can be as negative as anyone on changes such as this, but I think your scenario's probability is about as close to zero as possible. That would put Amex way, way out of competition w/comparable credit card offerings that provide Priority Pass.

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Old Mar 13, 19, 1:18 pm
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Originally Posted by MT_Switch View Post
What are the odds that Amex decides to discontinue PP and redirect card holders to discounted pay per use via lounge buddy with this acquisition.
Priority Pass is a big name, and even though it's suffering some losses of late I think removing it would be a net loss for Amex's advertisement.

Perhaps the idea would be for cardholders to use the LoungeBuddy app instead of Priority Pass for entry, but if you have a Plat card on file it's $0 bill. This would still be a downside because even if every PP lounge was on Loungebuddy, PP includes restaurants.
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Old Mar 13, 19, 5:43 pm
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I hope the LoungeBuddy team got a decent payout out of the deal at least. I find their app useful even if I was never totally sure whether it could make enough money to survive. Though I wonder if Amex will see any reason to keep it functioning independently as it does, or if they'll just keep the information integrated into their own app on what lounges are Amex-accessible.
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Old Mar 13, 19, 8:58 pm
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If they get rid of the LoungeBuddy app and put it all inside the Amex app, it would suck for travelers based in parts of the world where Amex is not common/available.
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Old Mar 13, 19, 11:12 pm
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I like the LoungeBuddy app, but how hard would it be for a replacement to come along and do pretty much the same thing? It doesn't seem like much of a challenge to set up a comprehensive database of the world's airport lounges, and keep that database current. A team of six teenagers could do that job well.
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Old Mar 14, 19, 11:25 am
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Originally Posted by bgriff View Post
I hope the LoungeBuddy team got a decent payout out of the deal at least. I find their app useful even if I was never totally sure whether it could make enough money to survive. Though I wonder if Amex will see any reason to keep it functioning independently as it does, or if they'll just keep the information integrated into their own app on what lounges are Amex-accessible.
Originally Posted by Xlr View Post
If they get rid of the LoungeBuddy app and put it all inside the Amex app, it would suck for travelers based in parts of the world where Amex is not common/available.
According to this article: https://www.businessinsider.com.au/a...nge-app-2019-3
  • "The terms of the deal havenít been disclosed. However, LoungeBuddy was last valued at $US18 million ($25.4 million) in 2015 when it conducted a series A capital raising"
  • "American Express went on to say that LoungeBuddy would be a wholly owned subsidiary and would continue to be led by its founders."
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Old Mar 14, 19, 11:34 am
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Originally Posted by Gig103 View Post
....in 2015 ....
Let's suppose that LoungeBuddy's primary revenue stream has been sales of single visit lounge passes. Let's further suppose that surplus lounge capacity has been noticeably reduced since 2015 by a stream of new credit cards with bundled Priority Pass and similar memberships. This may have eroded that revenue stream, both because the travelers could use a membership rather than buying a pass, -and- because the lounges had less space to accommodate potential pass buyers.
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