The growing use of the internet is revolutionizing markets such as rental vacation homes and having an impact on major online travel companies as more travelers choose to book directly.

One of the oldest vacation home rental companies, Vacation Rental by Owner, is now attracting 20 million viewers per day, according to media accounts.

Vacation homes rental companies are now competing with hotels, particularly in resorts that market to vacationers, said the Associated Press.

"Not everybody wants to check into a hotel every time they go away. We don't want the same-old, same-old," said Henry Harteveldt, a Forrester Research analyst.

Meanwhile, Expedia, the world's largest travel agency, says its third-quarter profits fell 28% as more customers are booking directly from hotels and airlines.

"Expedia faces competition from other online travel agencies and the Web sites of hotels and airlines, which are benefiting from strong demand," reported Bloomberg News.

When business is good and there's a lot of travelers, suppliers don't need companies such as Expedia, said Howard Deshong, a portfolio manager at Value Partners in Los Angeles.

The move towards booking rental vacation homes on line is fueled in part by the units having considerable more living space than hotels, as well as such features as kitchens, which allow tourists to save money on cooking.

Some major online companies are moving towards adding vacation homes to capitalize on the trend.

Travelocity.com LP, for example, announced last month they were partnering with LeisureLink Inc. That puts Travelocity into the business of listing vacation condos and timeshare units in the US and across North America.

The arrangement is certain to further raise the profile of vacation rental properties, according to Steve Reich, a Travelocity senior vice president.

Report by David Wilkening