Will Apple Bite Into OpenTable?

Shares of OpenTable stumbled 3% on Friday after Apple filed a patent application for a cloud-based platform that includes restaurant reservations. 

The patent itself focuses largely on the actual ordering process and its impact on guests waiting for a table. Apple's technology envisions customers being able to place orders via mobile devices, and folks waiting for available tables receiving updates on their devices based on the prep times of what seated patrons have ordered. 

However, since the patent also details the way a restaurant manages reservations -- something that OpenTable's system offers to restaurateurs -- and mentions reservations, it is natural for OpenTable investors to grow a bit apprehensive. Will Apple invade its turf? Will Apple build a better mousetrap? 


It's easy to see why Apple is making a push for the hospitality market. DineEquity announced last week that it will be deploying 100,000 tablets -- one at every Applebee's table -- next year. None of them will be iPads.

The technology that Applebee's will be incorporating is marketed as one that increases the average sale by 10% and shaves the average table turn by seven minutes. Apple is naturally hoping that its broader technology becomes the centerpiece of the casual- and fine-dining universe. It may have lost DineEquity's Applebee's, but it doesn't want to be behind the times as other chains make the leap of faith in tech. 

Naturally all of these moving parts could eventually be problematic for OpenTable's growing empire. It has seen the number of North American eateries leaning on it for reservations climb 23% over the past year to 23,287 locations. These are largely foodie havens that require reservations. Apple's patent and the Applebee's move suggest that this is more of a play on the larger casual-dining market. However, this could still end well for OpenTable if the push for tech giants to take a stand in the restaurant space finds companies in a bidding war for it.

After all, Apple is merely filing an application. It can get rejected, modified, or scaled back. By the time it sees the light of day, OpenTable will likely have a much broader reach than it does now.

Apple isn't invading OpenTable's turf. It's validating it. This is what will reward investors in the end.

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The article Will Apple Bite Into OpenTable? originally appeared on Fool.com.

Longtime Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Apple and OpenTable. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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