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Corporate travel is about to get harder: lower fares to be removed from legacy GDS

Corporate travel is about to get harder: lower fares to be removed from legacy GDS

Old Mar 22, 23, 1:08 pm
  #1  
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Corporate travel is about to get harder: lower fares to be removed from legacy GDS

American Airlines recently announced that they would remove some fares from the GDS and make them available exclusively through NDC APIs. I'll spare you the technical details and skip to the operational impact - if you book through a corporate booking tool (like Concur) and have one of the major corporate travel agencies (BCD, AmEx, CWT), then about 40% of their available fares may be unbookable for you starting next month. The AA fares that you do see would be higher, which may trigger rule violations that guilt you or force you to fly another airline.

This follows other recent activity at AA to lay off a reasonable portion of their corporate sales team. One might say that AA is exiting corporate travel.

https://skift.com/2023/03/01/american-airlines-is-shaking-up-corporate-travel-booking-heres-why/
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Old Mar 22, 23, 1:27 pm
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I truly dont get this.

I have two separate businesses that Id love to be putting through mostly AA but the death of Airpass and the lack of any solutions that target smaller firms (even though it would be dozens of people spending $20k-$80k each per year) make it so much easier to prioritize the competition. Perhaps Im missing something though.

EDIT: some useful additional background available here: https://crankyflier.com/2023/03/13/american-blows-up-its-sales-team-launches-a-risky-war-against-corporate-accounts-and-travel-sellers/

Last edited by wutlol; Mar 22, 23 at 1:36 pm
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Old Mar 22, 23, 1:39 pm
  #3  
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My uneducated guess is that AA (a) sees the success (assuming it was successful) of EU-based airlines which started pulling content (e.g. basic fares) from the GDS years ago, and (b) they want to offer lower fares to more price-sensitive leisure travelers while gouging less price-sensitive business travelers. Ok. Could be a valid approach.

Companies are generally tied to using a big travel agency ("TMC") because they have to manage spend and must provide duty of care. That isn't possible if everyone books on airline websites. The problem with AA's move is that it puts their customers (companies) in the middle of a conflict between airlines and TMCs. Airlines want more flexibility to price than the GDS allows (fair), but TMCs aren't generally capable of doing anything with NDC content. TMCs say they don't want to build and maintain individual connections to every airline out there (also fair).

AA's success would depend on their ability to pull only content that's cheaper than the discounted fares that other airlines offer corporate partners (and thus maintain market share). And necessity breeds opportunity - eventually there will be so much demand from corporations to access lower fares that the TMCs will have to find a way to get the content back.

ETA: I agree - that Cranky Flier article sums it up pretty well.
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Last edited by TBD; Mar 22, 23 at 1:47 pm
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Old Mar 22, 23, 1:43 pm
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I'm not sure I see it that way (or even read the Skift article that way). If all three major GDS systems will have made the shift in the coming weeks, and those underpin most corporate agencies or booking tools, I would think it would force the remaining tools to make the same changes (or companies to switch to more competitive services).

This is a newer IATA standard that companies are moving to because it offers more flexibility in the way it sells inventory, services and package bundles (among many benefits) than the antiquated paradigm airlines have been locked into with the legacy GDS systems for generations -- it's not like it's some AA-specific initiative to drive sales to one to one of their own channels. It's an industry shift, we're just talking about AA's implementation of it specifically here.
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Old Mar 22, 23, 2:53 pm
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This is going to get very very ugly. A lot of travel is going to end very soon from pent up demand due to the pandemic.
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Old Mar 22, 23, 3:08 pm
  #6  
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BWISkyGuy: All three GDSs are working on NDC, but they've been "working on it" for like four or five years. The airlines for even longer. While I understand some groups (airlines) are running out of patience, the NDC is the New Distribution Capability and not a New Distribution Standard. The GDSs will be able to do ... something ... with NDC, but maybe that capability really only works with some airlines and not others. Same for TMCs.

There's a good video on youtube that focuses on the recent Southwest meltdown as a symptom for the archaic IT infrastructure of this industry. The last bit is specifically about NDC. I think he sums the situation up quite nicely - airlines want ndc, but can't agree on what it should look like. So, airlines try to go it alone, but realize it's cost prohibitive, and give up. Wash, rinse, repeat.


Even if you aren't interested in NDC, it's still an interesting video.
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Old Mar 22, 23, 4:02 pm
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The article is making this a big deal when it's not.

As buried in the article:
Sabre also argues NDC is a technical standard, not a commercial model. “Commercial structures are evolving as business strategies evolve across the ecosystem — this will continue regardless of technology standards,” said Kathy Morgan, vice president product, airline supply and NDC at Sabre in a recent blog post.
This move to NDC directly affects GDS. BCD, AmEx, CWT are travel agencies, not GDS; each of them use one or more of these three GDSes.

According to AA, Amadeus and Travelport is already NDC capable since October and Sabre to adopt this April.

American’s NDC-enabled content is already available with Amadeus and Travelport and will be available in Sabre in early 2023.
So in other words, you're not going to see missing fares unless Sabre's April go-live is delayed and your corporate agency is using Sabre and AA proceeds with cutting these fares off from Sabre instead of working with Sabre towards a new go-live date.
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Last edited by seawolf; Mar 22, 23 at 4:13 pm
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Old Mar 22, 23, 4:26 pm
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That isn't correct, seawolf. Content won't be available to corporate bookers just because their TMC uses a GDS that is "ready."

The GDS has to be ready - fully ready - to replace GDS functionality. The GDSs have ticket issuing down in NDC. Certification and capabilities to manage a ticket are entirely different.
The online booking tool has to be able to receive NDC content. Right now, Concur can accept some of this content via non-GDS aggregators like TravelFusion, which is clunky as heck.
Finally, the TMC needs to be able to track and manage tickets. Right now, they can only manage tickets using non-GDS third-party platforms (TF Desktop and Farelogix), which they don't want to use ... and largely don't do.

All three have to work together. And, right now, they don't. You're also ignoring the fact that removing content from corporate tools is likely AA's intent.
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Old Mar 22, 23, 4:40 pm
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Originally Posted by TBD
BWISkyGuy: All three GDSs are working on NDC, but they've been "working on it" for like four or five years. The airlines for even longer. While I understand some groups (airlines) are running out of patience, the NDC is the New Distribution Capability and not a New Distribution Standard. The GDSs will be able to do ... something ... with NDC, but maybe that capability really only works with some airlines and not others. Same for TMCs.

There's a good video on youtube that focuses on the recent Southwest meltdown as a symptom for the archaic IT infrastructure of this industry. The last bit is specifically about NDC. I think he sums the situation up quite nicely - airlines want ndc, but can't agree on what it should look like. So, airlines try to go it alone, but realize it's cost prohibitive, and give up. Wash, rinse, repeat.

https://www.youtube.com/watch?v=1-m_Jjse-cs

Even if you aren't interested in NDC, it's still an interesting video.
I was speaking more to the point about loss of any current functionality or booking ability... This will definitely continue to require work in the future for the GDSs to keep up with all offerings that develop, but if two of the three GDSs are currently pulling data through NDC APIs, and the third goes live next month, then most (or maybe all) corporate booking engines would at least have the functionality they currently have. They're pulling that content will no longer offered via the Edifact protocol through the NDC APIs, for the current functionality. The GDSs are the backbone for the legacy travel tools that corporate agencies use -- or at least all the ones I'm aware of or have used.
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Old Mar 22, 23, 4:54 pm
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Originally Posted by TBD
That isn't correct, seawolf. Content won't be available to corporate bookers just because their TMC uses a GDS that is "ready."

The GDS has to be ready - fully ready - to replace GDS functionality. The GDSs have ticket issuing down in NDC. Certification and capabilities to manage a ticket are entirely different.
The online booking tool has to be able to receive NDC content. Right now, Concur can accept some of this content via non-GDS aggregators like TravelFusion, which is clunky as heck.
Finally, the TMC needs to be able to track and manage tickets. Right now, they can only manage tickets using non-GDS third-party platforms (TF Desktop and Farelogix), which they don't want to use ... and largely don't do.

All three have to work together. And, right now, they don't. You're also ignoring the fact that removing content from corporate tools is likely AA's intent.
This is completely open to interpretation, but the way I read the Skift article is that the AA shift coincides with the part of the transition that the GDS's are ready for -- i.e., the 40% of the content moving over exclusive to NDC APIs is content that the GDSs are now ready to receive/communicate that way. ...Hence the staged transition and the coordination with the GDSs.
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Old Mar 22, 23, 4:55 pm
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Originally Posted by BWISkyGuy
I was speaking more to the point about loss of any current functionality or booking ability... This will definitely continue to require work in the future for the GDSs to keep up with all offerings that develop, but if two of the three GDSs are currently pulling data through NDC APIs, and the third goes live next month, then most (or maybe all) corporate booking engines would at least have the functionality they currently have. They're pulling that content will no longer offered via the Edifact protocol through the NDC APIs, for the current functionality. The GDSs are the backbone for the legacy travel tools that corporate agencies use -- or at least all the ones I'm aware of or have used.
We've heard that Amadeus and Travelport and NDC-ready for years now, but they're really only ready for some NDC transactions. Even today, according to IATA, Amadeus is able to shop / order / pay, but not service tickets. And if the TMC can't manage your ticket or make changes, then the system is still broken despite AA's assertion that Amadeus is "ready".

I guess we'll see shortly how ready the industry is for this. My company is expecting a significant loss in content, which will drive a lot of noise and a reduction in AA market share.
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Last edited by TBD; Mar 22, 23 at 5:06 pm
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Old Mar 22, 23, 6:48 pm
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Originally Posted by TBD
That isn't correct, seawolf. Content won't be available to corporate bookers just because their TMC uses a GDS that is "ready."

The GDS has to be ready - fully ready - to replace GDS functionality. The GDSs have ticket issuing down in NDC. Certification and capabilities to manage a ticket are entirely different.
The online booking tool has to be able to receive NDC content. Right now, Concur can accept some of this content via non-GDS aggregators like TravelFusion, which is clunky as heck.
Finally, the TMC needs to be able to track and manage tickets. Right now, they can only manage tickets using non-GDS third-party platforms (TF Desktop and Farelogix), which they don't want to use ... and largely don't do.

All three have to work together. And, right now, they don't. You're also ignoring the fact that removing content from corporate tools is likely AA's intent.
Where do you see these concerns in the article? It’s just questions Ms. Reilly is asking but I don’t recall seeing anything in the article to suggest it is not being supported.

I interpret that as I’m switching from Windows to Mac and asking question how do I copy and paste in new OS. Valid question and the commands/approach may be different but I don’t see the article stating it is it not supported. Even Ms. Reilly indicate in last paragraph that she is not stating NDC is good or bad; she may have to adopt to a different approach. This is change management that comes with any implementation.

https://www.exploreamerican.com/glob.../ndc-overview/

seems to suggest everything they can do today can be done in NDC. Now it would appear GDS is ready but if the TMCs own systems are not ready to support all NDC capabilities which GDS do support then it would be on them.

Whenever you make a major change involving numerous parties which you have little control over you will have to draw a line in the sand at some point (you need the stick if the carrots are not working). You would never implement anything if you don’t.

Take credit card chip/EMV for instance. While widely adopted outside US, it wasn’t getting much traction despite the carrot of less fraud until VISA/MC drew a line (the stick) and said after a certain date whichever party in a fraudulent transaction that did not adopt EMV will be liable for the transaction.

Contrast that with Real ID Act of 2005 . DHS kept pushing out the deadline. Sure COVID further impacted it but the states dragged it out over and over again.

But to your point, maybe it's an issue with a particular TMC haven't fully adopt to this standard.
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Last edited by seawolf; Mar 22, 23 at 7:56 pm
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Old Mar 22, 23, 6:52 pm
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This seems like a nothingburger to me. Anyone who has ever worked in tech knows how this goes. We are ready, we are ready, we are ready... and then it launches, we are not ready, we are losing money, there is a lot of yelling, and things get fixed so we are not losing money any more.

It might be bumpy for a month or so.
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Old Mar 22, 23, 7:32 pm
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I own a travel agency, that is a "franchise" of sorts with a much larger group - and we have native access to Sabre. Sabre GDS and Sabre SONIC are 2 different systems (albeit same ownership and 95% same commands, its a hard "wall' between the two) - and thankfully our Sabre shows its an NDC link to AA, so I'm not sure how this is really going to affect corporate travel.
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Old Mar 22, 23, 7:57 pm
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Forgive me. NDC is airline speak for instant dynamic pricing per query, without regard to traditional gds fares and inventory buckets?
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