What happens when all of your major customers are aligned against a key component of your strategy?
That’s the dynamic in play as global airline associations, representing “virtually all of the commercial scheduled passenger airlines that fly into or out of the United States,” wrote a letter to Ray LaHood, secretary of the US Dept. of Transportation, indicating their opposition to any DOT proposal mandating that airlines serving the US “distribute all content and services through global distribution systems.”
“Mandating that airlines distribute all of their content through a GDS monopolist will result in significant consumer overcharges,” the letter says. “The proposed DOT mandate will invariably lead to a reduction in competition and technology innovation, while increasing the price of tickets for the end-user consumer.”
The airlines argue that existing DOT consumer rules, requiring airline-bag fee and on-time performance disclosures on airline websites, already provide consumers the information they need “in a timely and coherent manner.”
“Furthermore, we do not believe it is appropriate for DOT to interfere in contractual relationships between airlines and GDSs, particularly at the present time where there is pending litigation in this area,” the letter says.
The following airline associations signed the letter: International Air Transport Association, National Airlines Council of Canada, Arab Air Carriers Association, Association of European Airlines, A4A, African Airlines Association, Airlines Association of Southern Africa, Latin America and Caribbean Air Transport Association and Association of Asia Pacific Airlines.
Jill Brenner, a spokesperson for Travelport, says: “We are reviewing the letter but clearly disagree with the characterizations of GDSs which are completely inaccurate, at least in relation to Travelport.”
Art Sackler, executive director of Open Allies for Airfare Transparency, a group which counts Sabre, Amadeus and Travelport among its members, wrote a letter to LaHood in response to the airlines’ missive and he claimed that the carriers are creating a “straw man argument” because he doesn’t believe any such DOT proposal is in the works.
Sackler wrote that Open Allies does not seek a rule requiring airlines to contract with GDSs or any distribution channel, but once they do “fairness to consumers demands that it share ancillary service and fee data in a comprehensive, transactable and dynamically updated manner through that channel.”
The Open Allies letter continues:
That is, the airline should make all, not some, of the information about a particular itinerary available to the consumer, and enable him or her to buy all, not some, of at least the ‚Äúcore‚ÄĚ (baggage, seating, boarding) services associated with that itinerary, through that channel.
Open Allies seeks a new rule, or an expansion of existing DOT rules, to ensure that online travel agencies, GDSs and all other distribution channels “are provided with transparent, transactable and dynamically updated airline fee data, enabling true comparison shopping and consumer choice,” the Open Allies letter says.