30 August 2009

Farelogix Cements Trend Towards Off Core Profiles With New Product Line.

At this year's NBTA in sunny San Diego (sadly I could not go this year so I am late in catching up with all the info out there), one of of the hot topics was the move by the GDS to shift Profiles out of the the central TPF core. Everyone is doing it. Sabre, Amadeus and Travelport all have versions either as demoware or in roll out.

Now comes the announcement that Farelogix has a new product FLX Files. From the Farelogix PR piece:

“We see momentum toward universal traveler profiles for two reasons,” said Jim Davidson, president and CEO, Farelogix. “First, decentralization is no longer practical for storing and managing multiple profiles. Maintaining profiles in multiple sources and locations creates too much expense and duplicity, and synchronization headaches. Second, the industry is moving toward independence, data ownership and choice. Nobody wants strings attached. As technology proliferates, opening up is essential so customers can pick and choose the components that work best for them. What we are providing is an extensible, easy-to-implement, open system that can be integrated with as many other systems as customers want. With FLX-Files users get more control and flexibility, while maintaining full ownership of their data.”

In my humble opinion this is not a new issue. In my day job I have seen several far-sighted companies take their Profiles OFF GDS core before. Indeed my team have even helped to make this happen. However because it was an anathema to the centralized data management concept of the GDS - it was both frowned on and actually very hard to execute. Last year Sabre allowed me a sneak peak at their new off-TPF based Profile system. One of the interesting topics to emerge during the discussion with the project team was that they say this as not just a single and solitary change but rather the underlying core technology (my words) unbundling of one of many of the central customer file management functions of the GDS. Sabre was unabashed in their enthusiasm for the move including moving the PNR away as well.

My sense is that we are seeing (finally after very many years) a radical restructuring of reservation type products not just by the GDS but also by the airline PSS vendors as well. SITA's new PSS has a customer centric vision rather than a PNR centric vision. CRM is driving much of this change.

In my view the whole concept of the unbundling of the GDS is a natural progression. When I started working in distribution in the early 1980s, the only electronic way to communicate was a cradle to grave approach by the then CRS companies. 100% of their services were provided by their own systems. Quickly the independent vendors ABS/ADS, TravelLink et al were snapped up by the GDS. Very few PNRs made it through the agency lifecycle being touched by anything else other than a human and perhaps a back office vendor's product.

Fast forward to today and in almost all major markets each PNR is touched by multiple external systems. This has shifted the focus of the reservations system to the front line. Front Office and Mid Office applications are used (and paid for) by the intermediaries. This has eroded the importance of the GDS to the user community. In the early 1990s I used to draw a diagram that showed the GDS moving away from the front and center of the Intermediary tool kit to a box on the higher content (read supply) source line. While in my mind it has taken way too long for this to happen - it has been a slow and steady progression to get there.

If one examines the features and functions of an OTA for example - one can see that the key GDS functions (supply access, file management, search etc etc) are performed better and with far greater flexibility by these players than by the GDS platform providers. The OTA functions are a superior superset. I wont dwell on the subject of why the OTA's still use the GDS - that is for another time.

Farelogix is one of the innovators in addressing the needs of the supply side and the distribution side and their evolution. They are however by no means the only player doing that. The long term trend to me is an inevitable migration away from the bundled one size fits all GDS centric model to a fragmented but more customizable set of relationships managed by different and more appropriate technologies and players. I will caution everyone - with this power comes responsibility. Are we ready to take that on yet? I think so - and so it would seem do quite a few other players.

The death of the unitary model has oft been predicted. Frankly I think its already here.


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