Agents warned they will have to share GDS costs with airlines

Monday, 07 Oct, 2003 0

Agents are going to have to accept that they will have to bear some of the costs of a GDS booking, according to Worldspan’s Peter Dennis.

Speaking at the Advantage Business Travel Conference in Dublin yesterday, Mr Dennis told delegates that it was understandable that airlines were no longer prepared to pay all the costs themselves.

He commented: “The airlines are in dire straits and see that distribution cost as one they could take control of and we embrace that.”

And he asked delegates: “Do you believe it is right that you use technology free of charge? It’s not the case in any other industries of the world.”

Mr Dennis added: “I would love to provide you with technology free of charge or reimubrse you but it’s now reached a point where every travel agency has a GDS. It’s dog eat dog. You are not going to get the renumeration from us that you got in the past and you are going to have to embrace that.”

Mr Dennis said he also believed that in the future it would be the corporate, rather than the business travel agency, who held the contractual relationship with the GDS. He said: “[The corporate] will require you to fulfil on that platform. Whether that will require you to be multi-GDS I will let you think about that.”

He said that while travel management firms might claim they are providing detailed management information for clients, corporate companies are “telling us otherwise.” He claimed that if the corporate had the relationship with the GDS this would remove the need for agents to have a “powerful technology.. which you can ill afford.”

According to Mr Dennis it was only a matter of time before corporates began filing for their own IATA licence, as had happened in the US with corporates filing for their own ARC accreditation.

None of the three panellists – from Galileo, Amadeus and Worldspan – were prepared to comment on what would happen if British Airways decided to carry out its threat to stop working with all the GDS firms. Galileo’s Alison Bell merely remarked: “They could, but they shouldn’t.”

More from the Advantage Business Travel Conference tommorrow…

Read our previous stories:
02-Oct-2003 BA says GDS model is ‘fractured’
12-Sept-2003 Guest comment: David Brown, Sabre
20-May-2003 GDSs: Booking fees will come down