Reports of the death of the package holiday last week were greatly exaggerated. The claims were founded on a survey by investment bank Goldman Sachs which checked the prices of 20 randomly chosen package holidays and discovered that it was on average 26 per cent cheaper to book flights and hotels independently. 'The great British package holiday is being killed by DIY travellers,' wailed one newspaper headline.

But before we don the black armbands, let's take a closer look at the patient. It's certainly not dead yet (14 million of us travelled on package holidays last year) but it is looking a bit peaky (thousands of unsold holidays still on the shelf for this summer) and I would surmise that the damage is largely self-inflicted rather than the doing of dastardly DIY travellers.

In recent years the big package tour operators have changed their 'one size fits all' approach to holidays, claiming that today's discerning travellers want a tailormade service. That may be true, but all their marketing jargon is just a disguise for what's really happening. Elements of the package holiday which were once automatically included (meals on flights, transfers to the hotel) are being stripped out and charged for separately as 'added extras'. It has nothing to do with customer choice and everything to do with making the price in the travel agency window look cheaper.

Unfortunately for the tour operators, we are not quite as stupid as they would like to believe. It wasn't long before holidaymakers - and the Office of Fair Trading - saw through this 'virtual reality' pricing and began to demand more transparency.

It leaves a bad taste in the mouth when you phone up to inquire about a £199 holiday only to discover that it comes with a raft of hidden extras, from supple ments for in-flight meals to a fee for the privilege of sitting with your family on the flight.

Surely the point of package holidays is that they take the hassle out of booking a holiday by taking care of all the niggly things such as airport transfers? A holiday without those extras is basically a flight and a hotel and, as we all know, you can often get them cheaper if you book direct.

I have nothing against package holidays. I've travelled very happily on many myself. They offer a lot of advantages, not least of which is the peace of mind you get by booking through a tour operator which is bonded for your financial protection and which will bring you home if something goes wrong. (Witness the Foreign Office advice against travel to Kenya this week. Some 1,200 people on package holidays are being flown home by Abta tour operators: those travelling independently will have to make their own arrangements if they want to return now.)

Essentially package holidays are the ready-made microwave meals of the travel industry. We buy them because we're in a hurry and we can't be bothered to shop around for the ingredients. If Marks & Spencer started making us peel our own spuds we'd balk at the higher prices of their bangers and mash oven-ready meals.

If tour operators can't compete on price with the no-frills airlines and hotel websites, then they must compete on added service and convenience. The internet doesn't have to mean the end of package holidays, just so long as they do what it says on the label: offer a package.