British Airways is moving away from distribution “defined by GDS relationships” and “restricted by the GDSs” according to Stephen Humphreys, BA head of global sales.
Humphreys spelled out the significance of BA and Iberia’s imposition of an £8 charge “per fare component” on GDS bookings last week, which adds £16 to a return ticket for agents without fee-waiver agreements.
He told the Guild of Travel Management Companies (GTMC) domestic conference in London: “We’re working our way from a system-centric relationship to one that is more customer-centric.”
The IAG-owned carriers insisted the fee would apply to all bookings “not made using an NDC-based connection” or made direct when they announced it in May. NDC is Iata’s ‘New Distribution Capability’ standard for ‘direct connect’ portals.
Yet the airlines have agreed a series of deals with travel management companies (TMCs) and leisure agencies to allow “bookings through existing platforms without a charge”, although so far only through Amadeus.
Humphreys told the GTMC: “Distribution is at the centre of the digital space now. There are a couple of big forces at play. One is around GDS relationships. We’re moving away from a content strategy defined by our GDS relationships to one not restricted by the GDSs. The other is around how we manage that change.
“NDC is not a silver bullet. But in time it will unlock a lot of opportunities. We are trying to move forward in consultation with the industry.”
Asked about GDS-fee waiver agreements signed with Carlson Wagonlit Travel, HRG, American Express GBT and others, Humphreys said: “These agreements are about working with major partners on a timeline for implementing NDC.
“We’re working on implementation, hopefully with existing technology players. We think these arrangements are in everyone’s best interests.”
Travelport chief executive Gordon Wilson dismissed BA’s NDC connectivity last week as “not fit for purpose”, insisting: “There is no NDC connectivity of any note.” But Humphreys said: “Gordon has acknowledged there is significant change in the market. NDC will continue to evolve.
“Airlines file over 100 million fares through ATPCO [the Airline Tariff Publishing Company] to distribute through GDSs. Think of the work involved in that. It’s hardly dynamic. We are constrained.
“NDC will not solve everything, but over time it will change the way we price, the way we bundle, the way we present our offer to customers. We can be far more tailored and targeted.”
He told the GTMC: “I encourage open dialogue around new technology and a new way of working.”
Humphreys insisted: “TMCs are at the centre of our highest-value business. We want to work with TMCs. We will always work with third parties that add value.”
He added: “TMCs have built their proposition on fantastic technical knowledge and customer service. [Yet] increasingly, these qualities are not enough. More and more it is about understanding, collating and presenting data. We’re in the same space. All of us have to manage data. I like to think we can find a way to better integrate and work together.”
Reminded of the systems meltdown BA suffered in May, Humphreys said: “We had a lot of help and support from the industry. I want to thank everyone for their help.”