Feature: The GDSs

Sponsored by Galileo.

Travelmole investigates the four major GDS systems and charts their latest progress. We asked each one about their market share, e-business plans, diversification strategies, and future directions…

Where are they now?
Galileo reported a healthy 57% of market share and revealed that its UK market was increasing across the whole booking spectrum ­from business travel to leisure. However, the company’s UK general manager, Pat Minogue (left) said: “Galileo was mainly looking to the leisure sector for its key growth over the next few years, and was currently conducting an audit to clarify the market potential.”

Mr Minogue also believes that “previous barriers between the leisure and business markets are now breaking down, allowing greater integration and building greater booking revenues across all market sectors.”

Worldspan’s senior vice president Mike Parks believes “2002 will be a challenging year for all GDSs post September 11”. However, he added 2002 would still be a growth year because the company had the foresight to fund, develop and write effective e-business solutions, which because of higher internet usage are now producing high revenues. He said: “What we are seeing now is that other markets ­notably the UK and Germany ­are starting to move from ‘e-commerce excitement’ into ‘e-commerce reality’ and I think that will result in strong growth for GDSs that are positioned to take advantage of those trends.” He added: “With more than 50 per cent of all e-travel bookings, we feel comfortable – but not complacent – in meeting those needs.”

Sabre also reports strong growth in the European leisure markets where it has strengthened its position in Scandinavia and has obtained booking leadership in Greece. This follows Sabre’s policy of planning to expand its presence in Europe.

Chris Kroeger (right), Sabre’s senior vice president for Europe, the Middle East and Africa, said: “Much of the new business had resulted from Sabre developing products to match its customers evolving needs, and from its technological leadership in areas such as online travel, customer relationship management and revenue maximization”.

He stated: “This, combined with our ongoing development of local content and our commitment to customer service excellence, has given us the edge. We’ve long been a global leader, as well as a local partner for the travel agency in all our markets.”

Amadeus, most known for its strength in Europe is also growing in the UK. Over the last two years it has increased its market share by 6% to 14%. Mark Lewsey from Amadeus claimed: “Of the 70 million scheduled airline seats available in the UK, a quarter are now booked through Amadeus.” The company is expects its key market growth to come from devising working front ends that connect into key travel agents in Europe.

Company structure
Since last year there have been sweeping changes for Amadeus and Galileo. Amadeus has doubled its UK staff from 30 to 60 and hired five senior managers to strengthen its UK market proposition. This has built a strong platform for future growth and the firm is now reaping the rewards with its healthy growth in market share in the UK.

Galileo’s recent acquisition by Cendant has led to a complete restructuring. The company is now segmented into three autonomous trading areas. This has improved its standing on the US stock market and will enable Galileo to focus on key issues and grow globally. The acquisition is said to have given the firm “content and direction” in the leisure arena. Cendant’s ownership of NCP, RCI timeshare, Avis, Ramada and Travel Lodge will also help global bookings, as customers now automatically use Galileo as their main booking tool.

Worldspan and Sabre have not undergone such radical changes over the last year and have achieved their growth by steady and sustained planning.

Diversification
Both Amadeus and Galileo have active diversification strategies in place. Over the last two years Amadeus has increasingly provided a reservation system for airlines. Currently it hosts BA and British Midland, and has announced that Qantas will follow shortly. It also hosts 100 other airlines and is writing departure control systems for BA as well as gaining other business through its outsourcing. Galileo is also looking to write other new systems for other companies and in addition is evaluating the benefits of hosting. Meanwhile Sabre is migrating its mainframe applications to Compaq¹s NonStop Himalaya server and database environment to create the next generation travel technology platform to enable the company to diversify and effectively meet customer demands.

Today each of the GDSs is taking time to understand the impact of the September 11 tragedy, which initially suppressed the business market, but has not had the same effect in the leisure arena. In conclusion, Travelmole found as all four GDSs are either expecting to expand, or are expanding in the leisure arena through their new e-commerce applications. This is not from overnight growth but is the result of many years of forward planning, and their ability to write appropriate new technology to fit the changing market.

This feature is a follow-up to our previous GDS listing. Click on the following links to see previous information on the four main GDSs; their background, core products, useful contacts and more: Amadeus, Galileo, Sabre, and Worldspan.

Coming soon…An in-depth look at:
E-ticketing (20 May 2002)
Corporate booking tools (3 June 2002)
CRM in travel (1 July 2002)
Travel Training (4 November 2002)

Read ‘The TravelMole Interview’:
23-Apr-2002: John Davis, Pegasus Solutions
15-Apr-2002: Gregory Hunt, ABTA Arbitration Scheme
09-Apr-2002: Stuart Winter, Atinera
03-Apr-2002: Roberto Da Re, Dolphin Dynamics
26-Mar-2002: Arnaud Debuchy, Amadeus
19-Mar-2002: Helen Baker, Lastminute.com
12-Mar-2002: Pat Minogue, Galileo
07-Mar-2002: Jon Hart, MyTravel
28-Feb-2002: Lawrence Hunt, Rapid Travel Solutions