Ai Editorial: Are travel tech “laggards” starting to hit back at challengers?

5th August, 2019

Ai Editorial: The option of going “off-PSS” was being suggested for being in control of the offer. But in an industry where the status quo isn’t easy to change, have the so-called “laggards” caught up with the challengers, probes Ai’s Ritesh Gupta

 

There was rather a prolonged period in this decade when travel B2B specialists, including the likes of Amadeus and Sabre, faced a barrage of questions around the waning utility of industry-specific systems they were coming up for operations and commercial interests of airlines. Airlines were recommended to explore scenarios which would help them to focus on real-time offers, personalisation, rich content and ancillary revenue generation.    

All of this hit its peak post developments such as IATA’s NDC XML standard (the talk around being in control of the offer, then differentiation between NDC and non-NDC content etc.), dealing with the issue of look-to-book ratio (cost considerations) etc.

However, the status quo didn’t change that easily, even though there were constant discussions around going off-PSS for retailing.

Specialists or ‘best of breed’ with reference to a particular system or even more came into the equation owing to their flexible infrastructure and overall agility, being relatively faster to market with their offering and also being responsive to specific requirements. There have been cases where established airlines have gone ahead with implementation of products, for instance, for merchandising, from relatively newer players. But whenever the possibility of opting for a new offering emerged, the question around the risk involved in running routine operations and integration cropped up. This is because to switch over to a specific product/ company and operate such systems requires considerable technical expertise. “Every system that is in place has a certain role to play and so it is there for a reason. It is designed to work in totality with the entire product IT suite. Is the backward integration streamlined?” these sort of critical issues were raised, and hence airlines chose to pull back or it prolonged the decision-making of airlines.

(Also read:  Preparing for the impact of NDC on business functions)

Catching up

Reflecting today on the last couple of years, it seems the same players have managed to thwart the danger to an extent, and already singing different tunes today.

And they are backing it up with new contracts for the standalone products, and not for the entire IT suite.  

As Amadeus shared details of a deal with Alaska Airlines to optimize revenue across its expanding multi-hub network, it underlined that Amadeus is capable of integrating seamlessly with another passenger service system (PSS). It is ready to offer its technology for revenue optimization to any airlines regardless of their PSS. The deal made Alaska Airlines the first non-Altea carrier – and the largest globally – to implement the Amadeus Revenue Management solution.

“…as other suppliers fail to keep pace with out-dated TPF mainframe technology, the Amadeus Airlines Platform is filling the gap with leading technology that is simple, agile and open. This technology is particularly useful because it gives third parties the ability to develop solutions on top of our solutions. Amadeus’ targeted investment in critical technology reinforces our commitment to address key customer challenges and enable their success and growth,” wrote Mike Douglass, Senior VP of IT Sales, Airlines - North America, Amadeus, in a blog post.

He also added, “This technology is particularly useful because it gives third parties the ability to develop solutions on top of our solutions.”

Sabre, with moves such as the acquisition of Farelogix late last year (a highlight being connectivity across nine leading airline reservation systems (PSS) and NDC integrations with every global GDS), is keen on GDS- and PSS-agnostic solutions for dynamic offer and order management, plus NDC-focused development across scheduling, pricing, shopping and fulfilment. Sabre has been considering integration of NDC offers into GDS, plus the ability to scale NDC volume quickly across the travel ecosystem; integration of a PSS-agnostic merchandising engine with PSS and gain ability to deliver value to airlines on all bookings regardless of PSS system or distribution channel. Sabre even indicated that Farelogix products will help address a potential $2 billion opportunity across the world’s 300 largest airlines.

Travelport, prior to its acquisition by affiliates of Siris Capital and Evergreen Coast Capital, had moved to the Scaled Agile Framework (SAFe) methodology for its product organization.

Even as aggregators, GDSs are now counting on artificial intelligence for search technology i. e. for the requests coming from travel transactional platforms/ traffic sites. In this context, companies like Travelport assert that today they intelligently cache at the edge of the cloud. So while they still hit an airline system to seek relevant, up-to-date information, it is being pointed out that they are relying on data analytics and AI tools, along with data models for speed, accuracy and relevancy.  More the system of airlines is hit, higher the expenditure for them. This is relevant for airlines considering the fact with NDC; it is the airlines that are going to make the offer, and not GDS companies that are going to make use of data to make an itinerary. Travelport has grown to more than 11 billion searches per month.  

 

Interested in NDC and travel tech? Must attend the upcoming Mega Event Asia-Pacific, to be held in Kuala Lumpur (20 – 22 august 2019).

Event site: www.megaapac.com

 

Editorials

  • Ai Editorial: Fostering loyalty by being a superapp - airlines ready for it? +

    Kuala Lumpur, #MegaAPAC 21st August, 2019 Ai Editorial: Completing every transaction with one app is increasingly becoming common in Asia. How are airlines responding to such a trend, and in Read More
  • Ai Video: Countering mobile commerce fraud via continuous authentication +

    15th August, 2019 It is imperative for travel e-commerce companies to be ready for bots, emulators, malware etc. and be precise with their fraud prevention plan. As a specialist in Read More
  • Ai Editorial: Where is new digital currency, Libra, headed? +

    12th August, 2019 Ai Editorial: In an era where anything around personal information handling practices is being given a priority, the future plans for Libra are being probed, writes Ai’s Read More
  • 1
  • 2
  • 3
  • 4
  • 5