GDSs clash as concern mounts over airline distribution

Monday, 18 Nov, 2005 0

WTM Special Report: Airlines with stakes in GDSs must be forced to distribute through all rival systems to avoid any abuse of position, a World Travel Market seminar heard.

Galileo and Sabre both called for the existing ‘mandatory participation’ policy to remain following de-regulation or risk an unfair marketplace.

The European Union has proposed to scrap the ruling.

Their concern surrounds Amadeus in which Air France, Lufthansa and Iberia hold more than 40% of the company. Without mandatory participation, they fear all three could distribute solely through Amadeus in certain markets – including their home countries of France, Germany and Spain – forcing agents to adopt the Amadeus system.

Cendant chief operating officer Chris Vukelich, who has responsibility for Galileo, said there were already examples in Asia of airlines with stakes in Abacus, a regional GDS, withholding certain ticket types from other systems.

“I was also at TWA when we owned what is now Worldspan,” he added. “You can control the screen.”

Other carriers may be present on the system but on page nine, he said.

“Airlines have proved themselves to be incapable of playing fairly and with that history of activity we believe mandatory participation needs to stick around for as long as there is airline ownership,” said Vukelich.

Sabre senior vice president EMEA Richard described the retention of the policy as “essential”.

“If there is complete deregulation there would not be a fair marketplace,” he said.

Worldspan also stressed the need for “a level playing field.”

But Amadeus rejected suggestions airlines would abuse their position.

Multinational customer group vice president Gillian Gibson said: “The concern is that Air France, Lufthansa and Iberia would distribute only through Amadeus in certain markets.

“We don’t support that as way forward for any airline. There is no commercial sense in it. It only costs an airline when they get a booking and why would any airline not want to maximise its distribution?”

Report by Steve Jones