inated the Guild of Travel Management Companies event. Ian Taylor reports from Monaco
Amadeus vexed by BA’s plan to levy £8 GDS fee
Agents and corporate travel management companies (TMCs) are “caught between a rock and a hard place” by British Airways’ imposition of a GDS booking fee.
IAG-owned BA and Iberia will
slap an £8 charge on GDS bookings from November 1. Fares will be available without the fee only if booked direct or via an Iata NDC (New Distribution Capability) direct connection to the airlines’ systems or via a booking portal which is not yet available. GDSs remain in talks with IAG
on integrating an NDC ‘pipeline’ into their systems. But Amadeus revealed that no coding could begin on this until December and would take up to 18 months. David Doctor, Amadeus
vice-president of provider offer management, told Travel Weekly: “IAG recognises it’s not ready.” He revealed the time lag at the
GTMC Conference, warning: “Iata will issue a new set of protocols in December. We’re not embarking on coding until we see the
“We don’t think it is in [agents’] interests or the interests of travellers”
protocols because it will be hugely expensive. Coding for delivery [of a BA NDC pipeline] will take 12-18 months from the moment we see it.” Key Travel founder Ajay Sodha said: “BA has given us until November to develop NDC pipelines or pay the fee. We’re between a rock and a hard place.” Doctor said: “We don’t like it. We
don’t support it. We don’t think it is in your interests or the interests of travellers.” But he warned: “Providers want
to react more with the traveller and not let you do it. They want to increase their revenue. To do that they want to place their offer in their own sales environment. The providers say ‘We’re going to treat channels differently’. That is what IAG wants. That is what is behind
NDC. Airlines want to control the offer to the customer.” Doctor insisted: “We continue to negotiate with IAG. The objective is to aggregate the whole offer for travel companies, to create the least disruption.” But he said: “There will be
several versions of this [and] airlines need to upgrade their systems to do that work. “It’s a difficult situation. We’re
trying to find a solution. We don’t know if we can solve it.” Doctor told Travel Weekly: “We’ll
only embark on it [developing an NDC pipeline] if there is a desire from the agency community. We’re discussing that with our customers now.” He said BA’s £8 charge “is significantly higher than what we’re going to charge [for GDS display]. It’s considerably higher than our standard rates. “Compared to a full content
agreement it’s out of this world.”
Amadeus’s
David Doctor: ‘We don’t like it’
TMC boss predicts direct connect will cause chaos for BA
The head of a leading TMC told Travel Weekly: “We won’t go direct connect. The client will pay the fee or we’ll book with a BA rival. “BA doesn’t fly anywhere
there isn’t a rival carrier.” He warned: “One-third of
all bookings are changed. BA will never be able to cope with [direct connect]. It will be chaos.” The TMC chief declined to speak on the record, but said: “They call us distribution. We’re not, we’re travel management. We use GDS distribution and add all sorts to it. They say we can go direct connect, but we won’t. “Lufthansa lost market
share [when it imposed a fee]. I suspect BA will lose more.”
Wait tells BA: Don’t disrespect the value of the B2B channel
GTMC chief executive Paul Wait demanded “transparency” and “honesty” from British Airways over its imposition of a GDS booking fee. Wait dismissed the alternative New Distribution Capability (NDC) booking channels proposed by BA as “not fit for purpose” and warned: “The TMC community and its customers will not be quiet or submissive.” BA and IAG-owned sister carrier Iberia will
impose an £8 GDS booking fee from November 1. Wait told the GTMC Conference: “We don’t
believe or accept that our channel is the most expensive – not if you [BA] truly understand our value, not if you take into consideration the true cost of direct selling, the technology development costs, the advertising and look-to-book rates.” He told BA: “Don’t disrespect the value of the B2B channel that delivers you the greatest overall value and average ticket price. Explain those calculations; explain the level of surcharge when the cost of a sector via a GDS averages £2 and the cost of attraction via Google is more like £16.”
Wait argued: “The previous director general at
Iata announced NDC as an enabler for airlines to bypass current distribution and intermediaries. The new director general basically said the same thing when he was at Air France-KLM. “We want to be part of the drive for change, but
the alternatives are not fit for purpose. We need an enhanced and extended version of what we have now, not an alternative that delivers less and creates fragmentation. Let’s have some clarity, let’s have some transparency, let’s have some honesty.”
15 June 2017
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