Future of Global Distribution for Airline Travel - 1 views
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Imagine if every airline used a separate reservation system to distribute flight information, instead of the familiar global distribution systems (GDS) in place now
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As travel professionals are aware, Southwest Airlines are not available in most systems for booking reservations. However, they do not negotiate with distribution companies to sell their product.
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Then travel companies would be charged to have the Direct Connect system in the long run, thus paying for the opportunity to sell American flights.
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It appears that American Airline is about to remove itself from the tradition global distribution system and introduce its own distribution system. American Airlines is advocating for distribution companies to utilize AA direct connect which is a direct link into AA's host reservations system. Currently American Airlines fares are no longer available on Expedia or Orbitz sites. This is because no contractual agreement was reached for the distribution of AA products. Travel professionals are waiting to see the result of this bold move by American as this has great implication for the future of airline distribution systems. If American Airlines pulls away from the mainstream GDS, consumers and travel specialist alike will be faced with the inconvenience of going to a separate reservations system to compare fares. Although travel professionals are now urged to use direct connect on a trial basis, the general feeling is that eventually they will be charged to sell American Airline flights. To defend this move American Airline is only saying that direct connect will make it easier for them to tract ancillary fees like priority seating. It was noted in the article that Southwest Airline for the most part is a stand alone reservations system but they do not negotiate with the GDS companies to sell their flights. It is therefore quite evident that this move by American is really to reduce expenditure by eliminating the middle GDS companies while increasing revenue by charging travel partners for utilizing direct connect. American Airlines clearly wants to globally control their distribution system and maximize revenues. Contract renewal for both world span and sabre are due and the experts are waiting to see if American will renew with them. sabre is owned by American Airlines so its a wait and see game to see how all this will be panned out. The real problem for the consumers and travel specialists are that if other airlines are to follow this move by American the tra
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This article explains the distribution route American Airlines is taking to sell their flights. Due to not seeing eye to eye with the two most probably used websites for travel, Expedia and Orbitz, American has now taken their products away from both airline distribution sites. American suggest that all travel agencies and distribution companies begin using Direct Connect, which is a system for only American Airlines flights. If this would happen, travel agencies and companies will then begin having to pay for the system in order to sell Americans flights. At the moment you can still book flights through other distribution sites, but until when will that be? They already stopped Orbitz and Expedia, what's not to stop the others. The future of global distribution systems will be up in the air if all airlines choose to sell their own systems to be able to sell reservations. The only positive that was pointed out in this article was that if this system takes over, then more consumers will have to go back to using travel agents to secure the best reservations for flights and such.
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With the contracts for major global systems, Worldspan and Sabre, being up for renewal in the near future, this article analyses the possible outcomes for airlines, and alternatives should they choose not to forgo continuing use of GDS