New technologies, practices, and vendors are emerging to help airlines distribute their airfares. The new landscape is complex. But Air Canada's latest effort reveals at least one part of the emerging picture.
The revenue management industry picked an odd time to have an identity crisis, given the opportunity for additional profit that new rate-setting and distribution software could bring.
With this deal, Amadeus Hospitality finally has a chance to start selling its enterprise software after years of perfecting its platform-based offering.
Some sophisticated travelers like it when airlines embrace sophisticated personalization strategies, particularly when it means an airline will make a reasonably priced offer for something the customer values, such as an upgrade or a change to an earlier flight. But more casual travelers might find it intrusive. Regardless, personalization likely is here to stay.
Amadeus hopes to clear some of the underbrush that's grown up in hotel technology. If it succeeds, it will likely reshape the costs and systems used for selling rooms industrywide.
The global distribution systems are each pushing forward in their own unique way. By investing like technology companies in flexible distribution and payment technologies, they hope to provide a better value proposition to travel partners that are keen to cut out the middleman. Decades of bad blood between the two, however, still linger over the conversation.
For a couple of decades, distribution technology giants like Amadeus dictated contract terms to the airlines. But airline groups are leading a revolt to try to impose a new model on the middlemen. It's too early to say who will get the upper hand.
Travel startups face long odds, but the lucky ones have a champion in Suzanna Chiu, who has spearheaded an array of programs at travel technology giant Amadeus that have been helping startups thrive. The industry needs more folks like her.
Wasn't the whole point of these surcharges to prevent the global distribution systems from taking a cut of that juicy ancillary money that is now flowing in? One has to wonder what the terms of Air France-KLM's deal with Amadeus and Travelport really are. For now, it looks like the global distribution systems that took the new distribution capability seriously are reaping the rewards.