Channel hopping
New Distribution Capability promises to offer real choices for flight booking, but progress has been slow
By ROB GILL
o doubt you’ve heard the acronym NDC being bandied about over the last few years – but do you know what it really means for your air programme and how it may change the way your travellers book their flights over the next few years? If you don’t already know, you’re far from alone. For the uninitiated – or the so far uncon- cerned – NDC (New Distribution Capability) is a project headed up by airline association IATA (International Air Transport Associa- tion) with the stated aim of creating a set of new technological standards that “enhances the capability of communications between airlines and travel agents”, as well as reduc- ing the cost of distribution. Basically, when you move away from the seemingly impenetrable terminology, the airlines want to be able to sell all their
numerous ancillaries (seat allocation, hold baggage, fast-track boarding, onboard meals, etc) through intermediaries (mostly TMCs in the business travel context). In other words, all the things they have been able to sell directly through their websites and other direct portals for years. Doing this through B2B channels has been difficult because most bookings go through the traditional GDSs (global distribution systems), which is fine for the airfares them- selves but not so good (at least according to the airlines) for all the ancillaries that airlines have now stripped out of the head- line fare and are selling separately – as part of the ‘unbundling’ revolution spreading throughout the airline industry.
IATA first started talking about NDC back in 2012 when senior vice-president Aleks Popovich told BBT that it “could revolutio-
nise distribution capabilities by bringing us up to date with online retailers” and offering a more personalised shopping experience to these indirect bookings. Five years on, we are starting to see several NDC projects beginning to reach fruition with airlines such as Lufthansa and British Airways starting to sign a few NDC-based distribution deals with TMCs (see panel, page 81). And this looks likely to be the start of a trend towards more such deals as the advantages of NDC become apparent. IATA’s director general Alexandre de
Juniac explains: “NDC will help airlines deliver much richer information to custom- ers through travel agents. The challenge is to realise NDC’s full potential by driving up NDC transaction volume and overcom- ing the obstacles to achieving that vitally important objective. Already 36 airlines are using IATA’s standards for NDC, and 80 more will be on board in the near term.”
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