Headline sponsor Supported by business breakfast line Distribution and whether NDC means end of full content air distribution. By Ian Taylor
Lufthansa: Agents should aggregate different systems
Lufthansa has urged agents “not to wait” for a technology solution to fragmenting fare distribution.
The airline group has sought
to drive third-party bookings via NDC direct connections since imposing a surcharge of £11.30 on GDS bookings in September 2015. Andreas Köster, Lufthansa senior sales director for the UK and Ireland, said distribution is becoming “diversified” and insisted: “This system has to be aggregated at the agency [rather than the GDS]. Our message is ‘Don’t wait’. Talk to us. It is a diversified distribution landscape.” He insisted customers, agencies
and airlines would benefit from the change in distribution technology, saying: “It will be for the sake of the customer because we will be able to provide individualised, customised offers. It will be for the sake of
“We are very happy with our indirect sales. The agency channel will always be a key channel for us”
the agencies because it will close the gap with our dotcoms, and it will be for the sake of the airlines because it’s an efficient way to distribute.” Köster told the Travel Weekly Business Breakfast: “GDSs will always be there. They provide great content, but there is room for other tech providers and aggregation has to take place at the agency level.” He said: “This is about making
sure we get a new type of content to our customers who are used to consuming Netflix content, Amazon content, and buying on eBay. The distribution landscape we had was
KOSTER: ‘Airlines, customers and agents will benefit from new tech’
a bottleneck to innovation.” Köster added: “We are very
happy with our indirect sales. The agency channel will always be a key channel for us. Where we had an issue is that indirect distribution is dominated by three [GDS] providers and we felt the level of innovation and of costs were unbearable. That is why we introduced the [GDS] charge. “We have a substantial number of agencies connected [direct]. We will continue to remain in dialogue with agencies. We are in dialogue with the GDSs as well and with various tech providers to see what options there are to enhance the distribution landscape.”
‘Other sectors are ahead of travel in tech connectivity’
New airline distribution technology “isn’t working” at present, Deloitte consulting partner Andy Gauld conceded. Gauld said: “I appreciate the
technology isn’t working, but the technology is available to make it seamless for any part of the supply chain to work together. Airlines are working on it. It is the wider business issues that need to be solved. “Retailers look at the travel industry and ask, ‘Why are you so far behind?’ The technology has been proven, not necessarily in travel, but in other sectors that allow the connectivity. “There are new ways of
working that the travel industry is quite far behind on.”
Host
Andy Gauld TMC consultant: We’re moving to mass adoption of NDC
Widespread adoption of Iata’s New Distribution Capability (NDC) depends on “fixing post-booking issues” for travel management companies (TMCs). This could happen as soon as this year, according
to Caroline Strachan, managing partner of travel management consultancy Festive Road. Speaking at the Business Breakfast, Strachan
said: “We’re going through an adoption curve. Those consuming [airline content] through APIs are early adopters. We’re moving to mass adoption. “At the end of 2017, 50 airlines were NDC-certified
Caroline Strachan
and at the end of this year all three GDSs will be certified to NDC level 3. The technical capability will be there.”
However, Simon Ferguson, Travelport vice-president and managing director for northern Europe, questioned whether airline “API offerings” are “production-ready” for TMCs. He said: “Many airlines think the process ends when a booking has been made. For many companies, that is when the process starts. They manage complex travel itineraries, and early versions of NDC API simply have not had the functionality agencies depend on. They have not been able to handle interlining, they have not been able to handle complex fare types. “Many airlines start down the API route and then find the costs [too high] for the capacity required to handle the amount of searches the GDSs shield them from today.”
12 April 2018
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