Does anyone know what Hotwire's fees are for booking a room? Also, please share your good and bad experiences with Hotwire? I am a nervous new user!

I've used Hotwire with great success many times. Mostly for Boston, but also Baltimore (where we were positively delighted with the hotel) and NYC. I'm still nervous every time I book, as I'd really rather know the hotel before paying. There are no fees for booking. I've never had to cancel, so far. All in all, you must shop like the dickens first, familiarizing yourself with various hotels and rates for your dates. THEN, if Hotwire has something available with a suitable number of stars with a low enough rate, you might want to grab it. Sometimes, the hotel Hotwire awards you is just a little inconvenient compared to others (a few blocks farther from the focal point of the neighborhood or the nearest subway stop), but for the different in price (which will cover a lot of taxi fares) you won't mind. If you are planning way ahead, it's prudent to shop Hotwire every few days, as I've seen the rates go up and down for what I am guessing are the same properties. Perhaps Hotwire buys rooms at the same places, but at different times at different rates. Or, perhaps they change their own prices depending on how rooms are selling. Either way, I've sometimes paid more and sometimes paid less for a room on the same dates at the same hotel as others who've booked through Hotwire.

Donna, when outfits like Hotwire first came online, I was very skeptical as to how they worked and thought they might be scams (this was all the way back in 1997 for me...Pleistocene era by internet standards). I grilled one of the employees once about how the whole business operated.

I'm guessing Hotwire operates the same way as the others. The deal is that hotels which have difficulty filling their rooms (either due to less than ideal locations, lack of advertising budget, less glitzy than adjacent competitors, etc) strike a deal with "middlemen" like Priceline/Hotwire to sell their rooms. Hotwire may be guaranteed 40 rooms at hotel X, and they're told that for every room they sell, X will pay them $50. Hotwire then tries to sell the rooms as best as they can. Hotwire will have collected plenty of data to help them predict what price they'll have to set to attract buyers, and they'll have an idea of how much traffic to expect (there is industry software available which calculates all these probabilities, etc). As days tick away and rooms remain unsold, the computer program predicts how low (or high, if rooms are selling out faster than predicted) prices need to be set to continue to get consumers to "bite". That's why you see the fluctuation in prices.

Las Vegas' hotels have the most sophisticated rate planning systems in the world. Rates there can fluctuate hourly sometimes during high traffic times.

A high ranking Marriott employee posted an explanation here recently that hotels SELL rooms to online booking companies (but never less than cost she says). My experience with Hotwire, specifically, has resulted in excellent hotels of reputable chains (Doubletree, Hilton, Hyatt, etc.). My only quibble and reluctance has to do with location. In Boston, for example, The Back Bay Hilton and Doubletree Downtown, are a much longer walk from the places we frequent than other hotels of similar quality. There is no question but that hotels utilize sophisticated software to project fill rates for dates (based upon recent history, what's going on, etc.). For sure, an intelligent hotel booking manager would sell rooms to online booking services not anticipated to sell directly for projected slow periods. Booking directly through the hotel does have the advantage of a liberal cancellation policy, whereas the online booking services with the lowest rates typically require paying when you book with stiff penalties for cancelling or changing. I've been booking hotels throughout the year in many cities online for more than five years. Each time, it nearly a whole new endeavor. For me, the farther ahead you plan, and the more you "shop", the better the rate you'll receive. I booked online (with the hotel's online booking service) in NYC during February for October. I could not beat that rate after 9/11 for the same or a comparable hotel. For Christmas in NYC, I booked a room (again directly through the hotel's website) at a different hotel. I always keep shopping right up until I can't cancel. Curiously, a couple of days before we were due to check in, Hotwire couldn't come close to that rate for a similar hotel in the same neighborhood, the hotel, according to their online booking engine, was fully booked, but HotelDiscount was offering rooms for $50/night more than we were paying, but $100 less than I had booked directly two weeks before.

I've used both Hotwire and Priceline and I've never been disappointed. What you really need to do, as has been pointed out, is shop around. Educate yourself as to what the rates are at the times you'll be traveling.

Travis pointed out that hotels that are in some was less desireable offer reduced room rates to the hotel bidding sites. That may be true to a point, but if you're traveling on the weekends as I normally do, it's very easy to get a great rate at a hotel that mainly caters to the business sector during the week.
Example 1: Looking for a room in Boston (we didn't bite at the "conference rate" of $209 per night) we used Priceline and got the Wyndham Boston for $85 per night. Swank and cushy hotel, but it's located in the financial district which is nearly empty come weekends. At that savings my husband could hop a cab to the Sheraton and I was within walking distance of the aquarium and Faneuil Hall shopping area. BYW Nick, the reason we hopped to Priceline to try for a room is that Hotwire had offered either a 3* room for something like $149 per night, or a 4* room for $85 per night. I could have grabbed it, but I was more comfortable with Priceline at the time.

Example 2: All of the suite hotels near the DaimlerChrysler headquarters in Auburn Hills empty out come weekends. We got a rate of $27 per night through Priceline at Amerisuites - and that included a hearty breakfast.