NEW DISTRIBUTION CAPABILITY AND COMPETITION 601 What this bodes for competition law scrutiny of airlines’ use of NDC is unclear. 5. QUO VADIS? Developing the NDC has been a slow process, and the required tasks continue to change. The alliances have been frustrated to the point of developing (at huge expense) and now offering what are, in effect, NDC solutions across their partner airlines, ahead of the arrival of the NDC. In the meantime, the technology continues to evolve. Airline systems, GDSs and new generation systems all compete with Google’s capacity to know in advance your next holiday destination and compete with fare comparison sites that scrape data from airline and online booking systems, in order to put more information and, who knows, more transparency, into the market. Nevertheless, travel agents, usually sitting behind GDS screens, still make 50% of the bookings. Even the low cost carriers, which famously refused to use GDSs, list their long-haul services on GDSs53. It’s a distribution channel not to be argued with – unless you are Lufthansa or IAG, who has also introduced a fee similar to Lufthansa’s. IATA, having once touted the XML-based NDC as revolutionary – true if your system runs on telex – is now re-pitching it as nothing more than a neutral platform that will allow airlines to offer full content, including things like partner seat selection, bookings for unbundled content and as a means to collect that revenue. The bottleneck in the distribution of tickets, IATA claims, resides in GDSs, which dominate the market. GDS ‘full content’ contracts restrict airlines from distributing their own product. The contracts also require equality of treatment regarding access to capacity. Now, IATA claims, the GDSs say that allowing free sale will double the fees. The agents, on the other hand, claim that NDC will allow for the airlines to first assess the passengers’ identity and then quote accordingly. We are at the intersection of a number of different forces. The Internet has changed the ways in which one can search for information, including flight schedules and prices – once a secret business of airlines and their agents. Low cost carriers unbundled prices too, opening the door to the consumers realising 53 “Norwegian expands partnership with Amadeus to support its low cost long haul growth strategy” Air Transport News (Amadeus Press Release, 23 July 2018) online: https://www.atn.aero/#/article.html?id=68922.
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