If you are a frequent flier, you know there is a war raging between American Airlines and third-party travel providers, such as online agencies and Global Distribution Systems (GDS). It appears things might get worse before they get better, leaving millions utterly confused. So I’ve created a new addition to the “On the Fly” curriculum to help you through the hard times.
The two-hour live seminar, FLY 203: The travel-booking war and the future of airline data distribution, will be first offered in Miami and Honolulu next week, and in Washington, San Juan and San Francisco next month, followed by other cities around the country. If you are not in any of those cities, you can join in from anywhere for an hour-long webinar version, FLY 115: Weathering the travel-booking storm, on Feb. 10.
I’m not advocating any particular position in the current dispute, and my only goal is to give you all relevant information, so you can make the best decisions when it comes to booking your travel.
The new seminar offers a detailed description and explanation of the current airline data distribution model and the fundamentals of today’s booking system. It also looks at the events of the last several weeks and provides a factual rundown of the arguments and positions of all sides involved in the dispute.
Most importantly, the session examines how the current conflict affects travel agencies, companies and individual travelers. It offers specific advice on what they can do to avoid being caught in the crossfire, and to make sure they don’t increase costs and sacrifice convenience and comfort.
Late last year, American banned Orbitz from booking seats on its flights. Earlier this month, Expedia stopped selling American tickets. Meanwhile, Delta removed its data from eight less popular sites. Sabre, the GDS American created more than four decades ago and current owner of Travelocity, announced its intention to drop American data later in the year. In response, American sued, and last week it won a court order temporarily blocking Sabre’s move.
Thus began the very public war — and possibly the start of a new trend in the distribution and sales of air travel products. Airlines incur significant costs by having their flights booked on a GDS, which also prevents them from selling additional products, such as preferred seating, priority boarding and doubling or tripling your frequent-flier miles for a fee. American wants both online and traditional travel agencies to use its DirectConnect channel to lower costs and increase revenue.
The significance of American’s move is much bigger than a dispute with a couple of third-party sites. It seeks to shake up the longtime airline data distribution system, including the GDS model. Travel agents haven’t received airline commissions for years, except for the largest agencies, though a part of the GDS fees airlines pay goes back to agents. American wants to reduce or scrap those fees.
In an indication of where things are going, American CEO Gerard Arpey said in 2009 that third parties should be paying the airlines for access to their data, “rather than us paying them to distribute our product.”
American has imposed “booking source premium” fees on some GDS users. Those fees will have to be either absorbed by travel agencies or passed on to passengers. Critics accuse American of trying to suppress transparency and deny consumers the opportunity to compare various airlines’ fares on the same screen, potentially forcing them to pay higher prices. But American points out that a change in the GDS model — establishing direct channels with airlines — would secure customers’ continued comparison-shopping ability.
So it’s messy out there, and the new seminar will try to make it less so in your mind by giving you specific tools that will help you follow the best booking process for you.
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