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Advances in information and communications technologies (ICTs) have strategic implications for a wide range of industries. Tourism and hospitality have been dramatically changed by the ICTs and the Internet and have gradually emerged as the leading industry in online expenditure. The Internet revolutionized traditional distribution models, enabled new entries, propelled both disintermediation and reintermediation and altered the sources of competitive advantage. This paper explores the strategic implications of ICTs and the perceived advantages and disadvantages of Internet distribution for small and medium-sized hospitality enterprises (SMEs). Primary research in Athens' hotels demonstrates the effects of the Internet and ICTs for secondary markets, where there is lower penetration and ICT adoption. Interviews and questionnaires identified a number of strategies in order to optimize distribution. The analysis illustrates the strategic role of ICTs and the Internet for hospitality organizations and small and medium-sized organizations in general. Most hotels employ a distribution mix that determines the level and employment of the Internet. The paper demonstrates that only organizations that use ICTs strategically will be able to develop their electronic distribution and achieve competitive advantages in the future. [ABSTRACT FROM AUTHOR]