Executives at global distribution systems lose years of sleep worrying whether they will sign airlines to full-content deals in the next round of negotiations, but, in a new video, Farelogix argues that these agreements actually are bad for travel agencies.
Here’s the video, entry #4 in Farelogix’s Ask the Question series:
Of course, when American Airlines threatened to withdraw from the Sabre GDS several years ago, some major travel management companies signed on with Farelogix, which distributes airline content, to access American and other carriers as a sort of GDS insurance in the event that major carriers opt to quit a GDS or two.
Perhaps Farelogix should be asked some questions, as well.
What would it do to your value proposition if American Airlines or Air Canada decided to give you only a portion of their content? Would that be good for Farelogix and its TMC clients?
Probably not.
And does Farelogix, which is set up to distribute American Airlines’ ancillary services, which aren’t in the GDSs, benefit if airlines decline to deliver full content to GDSs?
I think the answer would have to be yes.
Still, does Farelogix make any valid points in the video?
Do full-content deals hurt travel agencies economically, thwart airline innovation and force travel agencies to compete on price?
After all, the GDSs will be negotiating full-content agreements with major U.S. airlines in 2011, although the term “full-content” is a misnomer since so much inventory these days is offered exclusively on Twitter, Facebook or airline websites.
But, what do you think about Farelogix’s main points?
I’ve worked for a tech company owning a GDS for several years, and have been in countless meetings with agencies.
The number one requirement FROM the agencies TO a GDS is always the same: full content.
Those agencies are probably in for a rude awakening after the next round of negotiations. With consolidation and unique value propositions at each carrier I am sure those carriers are looking hard a what it means to have every product in every store. Or does it makes good sense to be available in every store? The answer is likely no – and if that is the case then things will start to get very interesting.
I need to ask the question – in the alternate “windows” in the video there is a bald headed guy in a suit. Who is that guy???
Wing Tip: The guy making the cameo in one of the other screens is no one special — except perhaps to his mom and dad:) Farelogix tells me the pic is a photo they had on hand. The mystery man likely will remain so:)
Thank you Dennis!