Brief:

• American Express acquired startup Mezi, an AI-based virtual travel assistant that already powers the AskAmex personal concierge app started last year, according to a press release. Mezi users send requests for flights, hotels and restaurant reservations through its SMS-like interface. Then, the app makes suggestions on flights, hotels and restaurant reservations and forwards requests to human assistants to finalize bookings.
• The combination of Mezi's chatbot technology and its network of travel counselors will help consumers find unique travel experiences, Phil Norman, vice president of American Express Digital Labs, said in a statement. Mezi also offers a "travel-as-a-service" solution for travel agents, in addition to its mobile apps for iOS and Android.
• Mezi was founded in 2015 as a personal shopping chatbot that uses machine learning and natural language processing (NLP) systems that don't rely on IBM Watson and other technology providers. Financial terms of the agreement weren't disclosed.

Insight:

American Express's purchase of Mezi brings a promising technology in-house for the company as it seeks to adapt to the growing acceptance among consumers of chatbots and messaging apps to communicate with businesses. The payment processing and travel giant needs to have proprietary technology to ward off a growing threat from Silicon Valley. Google and Amazon are among the companies that have expanded their travel search platforms to help people find flights, hotels and restaurants, adding another jolt of competition in an increasingly crowded space. A growing number of financial services companies also offer chatbots for customer interactions. 

Google this week added two features to its flight booking search service to help travelers predict airline delays and see what amenities are included in basic economy fares from Delta, American Airlines and United Airlines, per VentureBeat. Google Flights now shows upfront the restrictions on seat selection, overhead bin access and carry-on bags before people book travel, eliminating several surprise frustrations for many consumers.

Mobile is growing rapidly as a channel for travel booking, according to a study by eMarketer. The researcher estimates the mobile travel booking market will catch up with desktop platforms in the next few years. By 2021, desktop and mobile platforms in the U.S. will each generate about $110 billion in annual travel sales, it said.