Trade faces GDS disruption

THE trade is facing months of global distribution system upheaval with British Airways planning to drop at least one of the four suppliers and Amadeus gearing up to charge agents fees.

Sources claim BA is close to concluding high-level talks with all four GDSs, with the likely outcome the complete withdrawal from at least one GDS and reduced fees with the remaining suppliers.

An industry source said: “BA will drop at least one of its GDSs and announce reduced terms with the others. It is just finalising deals and hopes to announce something before Christmas.”

The source claimed BA held talks with major on-line retailers and consolidators about establishing dedicated BA links and taking their fares off GDSs altogether, but the idea fell flat following a negative reaction.

Galileo and Worldspan both admit talks with BA are ongoing and hope to strike a deal soon.

Cendant Travel Distribution Services regional UK and Ireland marketing manager Nikki Harrison said: “We are very close to an agreement. Discussions are taking place between our lawyers and BA’s.”

A Worldspan spokesman said he was confident a “mutually beneficial” deal could be struck.

A BA spokesman said: “We are talking to the GDSs so rumours are bound to come out, but nothing is confirmed.”

In a further blow, Amadeus has confirmed fees are on the way in exchange for access to airlines’ cheapest priced stock.

Next year it will scrap blanket fees and introduce tiered payment based on where the fare was bought and the type of ticket. Agents charges are likely to follow in 2005.

The move will initially affect the US, but is likely to be extended to the Europe once deregulation is confirmed. 

Executive vice-president-commercial David Jones said: “We’ll get to a model where agents contribute to GDS costs in return for access to low fare content.”