As predicted here, Expedia has decided to make its temporary elimination of the airfare booking fee permanent. This follows in the steps of Priceline and Hotwire, which stopped adding a surcharge over a year ago.

The Expedia fee was scheduled to go back into effect on June 1. The company had two choices: Quietly reinstate the fees, and face the marketing wrath of the no-fee competition, or “permanently” kill the fee with a big fanfare. How’s the fanfare sound on your end?

The big agencies still get a cut of the sale, unlike most mom-and-pop travel agencies, so the extra booking fee monies were additional revenue. Many customers (31%, according to here) were doing their searches on the major agencies’ sites, and then going to the airline to book directly and save the fee. Now, the agencies’ fares should be on the same level as the airlines’ own websites.

Interestingly, Expedia also cut change fees in the same breath:

Other fee changes also were announced Wednesday. Expedia.com said it will eliminate the change-and-cancel fees on hotel, car rental and cruise reservations and on most flight reservations. Flights that are part of certain package deals will still be subject to a fee when reservations are changed or canceled. Expedia.com said it will resume charging $20 [on June 1, 2009] to make a flight booking over the phone, a fee that was halted during the promotion.

Eliminating change-and-cancel fees is nice, but it’s just the surcharge, not the totality of relevant fees. Airlines are charging $100, $150, or more to change itineraries for non-refundable booking classes, and Expedia can’t waive those fees. The elimination only applies to the surcharges which Expedia tacked on.

In any case, this puts pressure on Travelocity and Orbitz to make fee cuts permanent as well. Both of those sites’ fee-elimination policies have a sunset clause, and fees are scheduled to re-emerge on June 1. Neither site is commenting on whether they’ll follow Expedia’s lead or not. We’ll see if there are more announcements of newly-permanent fee reductions in the coming days…