05 September 2008

Single Image Product for Airlines becoming history

One of the ubiquitous characteristics of the airline distribution model is that despite a lot of different elements - we could pretty much rely on a single image of inventory in GDSs and airlines. Indeed it was built into the so called "Full Content" contracts.

However over the past several years there has been a growing trend towards the use of cached availability and O&D based pricing services. I wont bore you with the complexity of the technical details but the impact has been an erosion of the illusion of a single image of product and inventory of the airlines.

The rise of the meta-search engines has resulted in a massive increase in the number of hits to websites which in turn either demanded massive GDS and CRS transactions to be generated (by up to a factor of 64) on OTA and Airline.com sites or the deployment of cached availability solutions which made real time a thing of the past.

While fortunately this made little impact on the consumer - behind the scenes costs for providing services from technology rose significantly for no increase in revenues irrespective of who was paying for the technology. However now we are seeing cracks in the facade.

With the reduction of cheap seat inventory due to the global cut backs particularly for OTA type users - the meta search engines are beginning to show increasing number of different prices from those that you can book.

There is no empirical way to test this without actually exacerbating the problem. However from the limited tests we have seen - there are some significant differences occurring particularly during peak travel periods at peak booking periods.

This is not going to get any better. The model for providing the service is left to the GDS in many cases (either something like a System User mode or a pure GDS Mode) or to a 3rd party availability cache. As more airlines go to a pure O&D model or Itinerary based pricing determined by point of sale - the disconnect between these search facilities will become wider.

Something is going to break and not in a nice way.

You have been warned that someone is watching this closely

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