An Airline Seat - A Commodity No Longer

If you will indulge me - I am going to take a little time out to share with you one of my pet thoughts at the moment. As the Professor is formally on holiday - I have had an opportunity to think about the meaning of life. And I have been trying to get my head around the forces at work with regard to the battle for airline distribution.

An airline seat has been considered a commodity for a very long period of time. Brand differentiation has been considered as a loyalty issue. But today there is a very different perspective emerging. The airlines across the world led by the Low Cost Airlines have found that they can differentiate their product and that they can not only discriminate by price (the current exclusive currency) but by product feature.

As regular readers of the Professor's Wisdom know that I am not a fan of airline behaviour to their customers, as a frequent flyer - I am subjected to a litany of abuses at the hands of the airlines. Airline customer service is an oxymoron. But I need to use them and therefore have learned to accommodate some of their quirks.

However I am an ardent capitalist. I believe in freedom of markets along the lines of Milton Friedman. I believe that the owner of a product has the right to do what he wants with it. And if he is stupid with it - then so be it. As long as consumer rights are not trampled on - then the market should be free and open. (of course there has to be some societal constraints particularly for the environment and paying taxes).

Somehow in the past 10 years since 9/11 the airlines got smart. I think someone put something in the wine at Airline conferences to change the way airline execs approach the market. We have moved from the "capacity at all costs" approach to a more true market based supply and demand control model. The web of course has a lot to do with this. The creation of pricing transparency by the OTAs, Search players et al has changed consumer behaviour.

It is time to acknowledge that the world has moved on. There is no god given right to constrain a market and ALL contracts and practices that do so must be declared null and void. Preferred relationships can be allowed providing consumer rights are not trampled on. There still has to be balanced but innovation does not do well when trampled on by oligopolies or monopolies. (Think Google is a free and fair player - of course they are not). There are a large number of arrangements in various parts of the product lifecycle of an airline seat that constrain consumer choice and market freedoms. Airlines being allowed to create JVs – mergers in all but name being one. GDS contracts being another.

We need to acknowledge that the airline product is not a commodity but that it is also a utility. So it has certain responsibilities. Acknowledging the game of obfuscation by the airlines should not be something that is spoken of in hushed whispers!

What I think is going to be interesting is that there is a new issue on the table which needs to be addressed. This is the definition of who has the definitive "right price" for a particular seat on a specific flight. Under the present systems in place - the airlines have long delegated the pricing capability to the GDSs via ATPCo. That means that they are not in control of their own destiny. The obvious answer is to define a single (or controlled few) sources for approved pricing. Some airlines already do that. The LCCs for example have true dynamic pricing so you dont know what the pricing is until you have told the airline what you want. Bespoke pricing is not a new concept but it has always been hard to implement. The new technology developed for web engines however makes that quite normal and an easy low clost for the supply owner to manage. There are a lot of smart pricing engines out there in very complex products. Why not in airline seats?

So while the government's try to regulate ancillary services, in my view they are going about it in the wrong way. I think they should make the airlines publish a price list and then allow the airlines the freedom to define where the definitive pricing is stored and how to access it. It would make the process of regulation easier and by opening it up to all comers it would make the consumer be able to go to a definitive source(s) for information. The current system of different systems of proprietary logic and control is just outdated and needs to be blown away. A very good outcome is that the consumer would know where to go for a trusted and correct price – the definitive lowest fare. The current system creates confusion and also prevents Trust by the consumer.

Ultimately I believe that there should not be any mystery in it, we should think of other Utility markets and manage them appropriately and accordingly. Let all airlines compete freely. Let all consumers access the information fairly. Then let the intermediaries figure out how they can make money from offering services to the supply and the demand sides.

Yes - I am advocating a change in the system. I am so motivated by this that I am backing several ventures that advocate this position. In my view it is now time to just acknowledge that market freedoms are critical and that now is the time to do a good job in fixing the current screwed up marketplace that we have now. Today we have a closed system that has resulted in poor pricing transparency, an effective hidden tax to the consumer with innovation trampled on. All in the name of protecting the status quo. Well that needs to change. And clearly evolution is not appropriate. With both the EC in the form or regulation and the US in the form of the DoJ investigation are now looking at the situation.

So they should. But this time as consumers we should be getting a better deal. As capitalists we should let the most efficient way win.

Agents Tell Cooks & TUI To Hold Nerve - Are They Mad?

Agents in the UK on the back of a profits warning from one of the big two UK Travel players - Thomas Cook are encouraging the company and its bigger rival TUI to hold the line on pricing and not to discount so reports TTG.

As usual in a situation like this - the knives and the pundits come out. Blame is being splashed around. But the fundamental reason for the problem is too much capacity and too high prices.

Well welcome to the world of the open market. Cooks and the market got it wrong. The expectation is that magically that by Cooks holding the line on pricing the market will respond positively and then the problems will go away. Well that is a load of horse manure.



The clear problem is that there is excess capacity in the UK market and that is not going to get better for a while. The decline in traffic across all sectors as well as a flight away from the traditional bucket and spade brigade - is hurting the traditional VTOs. This is not a new phenomenon. It has been ongoing for some time. The decline away from the traditional package holiday is begining to plateau but with so few people taking this type of holiday - its no longer as relevant. The peak was 18 million pax in the early 1990s - now that comparative number is down to about 3 million. While the unbundled model points to a larger use of the resources inside one of the big two - the total pax is now much smaller. In my view the big two didn't move fast enough to migrate to the more consumer appropriate model a la carte services. Low Cost Carriers managed to eat away at everyone's market share. The days of infinite growth are over. Ryanair has actually been judicious and has pulled back capacity form STN. For whatever reason - this has benefited their bottom line. The big two could have thought that this would mean they could recapture customers.

Nope

So now there should be significant discounting or the inventory will just go to waste. There is a big need to stimulate the UK market and the only logical way to do that is by price. That means in my view slashing prices.

HRG's David Radcliffe Weighs In On GDS vs Airlines

In a recent article in ABTN - Air and Business Travel News, HRG's David Radcliffe was interviewed on a number of topics.

He had some choice things to say on a wide variety of topics. On the issue of Distribution he was quite sanguine. The specifics were the questions posed by the newsletter on the topic of the dispute between the airlines and the GDSs. He was empathetic to both sides. He did not think the agency community should be worried but rather aware and tuned into the debate. He took the long view - also shared by the Professor that there was something quite natural in the debate. He was clear that there was something wrong that needed to be addressed. Walking the fine line between the two warring parties he focused on the principle of the debate.

".....and you just look at the principal of what the airlines are trying to do... They’re not trying to do anything different to any other manufacturer or service industry, or anyone that supplies a product. What they’re trying to do is distribute that product in the way that they want to distribute it." He further expanded the comment "but ultimately if you look at what they’re trying to do it’s quite simple. They want the ability to distribute their products and not be commoditised by a single distribution point. I have sympathy with that."

This makes the debate more rational. And kudos to Mr Radcliffe for taking this position. If we go back a little in time - we have had other heads of TMC based agencies be less than forthright about some of these issues. Amex for example was famous for stating that they felt the low cost carriers were actually disrupting the smooth flow of the Agency's operations and that therefore the company would discourage its customer's from booking them.

At the moment we have the big 4 Global TMCs taking tentative steps on the subject. CWT has come out clearly against it and imposed what amounts to a financial penalty to anyone booking AA via the direct connect. Thus they are trying to preserve their model of conformity gets rewarded and exceptions get punished. In my view they have not been paying attention to what is going on elsewhere in other product categories in distribution.

Returning to Mr Radcliffe (no relation to the actor who plays Harry Potter), he reminded us all how we got to this point. Describing the growth, "Historically, the airlines were part of building up the GDSs, they even used to own them at one time. Some of them still do. So they built this monster, which they now want to change."

For the TMCs there has been a rational approach to the market of how they hook into the supply chain. They have developed a profitable model by working on cost plus and then removing from the equation the benefit packages of incentives from the supply side.

Early TMC contracts were built on a cost plus model and most of this continues to this day. TMCs are incentivized by their corporate customers to save them money, PROVIDED that they agency never loses sight of its role as a full service provider. To do this transparency exists largely in the dealings between the agency and its clients. All financial benefits from the supply side are passed to the corporation who in turn is charged transaction fees by the agency. Thus a corporate customer can see the goings on by the agency. But there are a large number of variations in arrangements. Some agents have held back the GDS benefits and kept them. Some GDSs have decided to contract directly with the company for GDS services. While this is a normal behaviour it can cause conflict and make the agency more vulnerable to shifting opinions by the corporation.

In a top of the hat to the GDSs he didn't want the GDS to think that they would leave the stage empty handed. The ubiquity model of today's one size fits everything of the legacy GDS is attractive to HRG. As MD he could clearly state "I also have sympathy with the GDSs’ point of view, from the simple philosophy that they are probably still the most efficient distribution method that there is."



But HRG was very aggressive in working with their technology platform. While some of their competitors have been focused on tuning the model, HRG has invested heavily in an open design to ensure that they can accommodate both the Low Cost Carrier Model (in Europe where approx 20% of all lift is on non-network airlines) and the independent supply chain products and services such as direct connect. He describes the capability that has been developed in Aldershot as follows: "to make sure as a company that we are capable of adding our value in the new distribution chain. I’ve been quite open to anyone who has asked me that we adopted a philosophy many years ago where we held on and developed our own technology. We do have the capability of direct connecting if that is the best path." Bill Brindle is the point man for this delivery at HRG. His heritage is GDS but he has focused on building a neutral and independent platform.

As Brindle's boss, Radcliffe wanted the readership of ABTN (who are largely UK and corporate travel management people) to understand what HRG's capabilities and vision are: ".... Our role is to keep the client informed of what the best options are moving through this and to make sure as a company that we are capable of adding our value in the new distribution chain. I’ve been quite open to anyone who has asked me that we adopted a philosophy many years ago where we held on and developed our own technology. We do have the capability of direct connecting if that is the best path."

That was a nice job of fence sitting and maintaining independence, which in his position is a very prgamatic point of view. In the Innovation in Distribution conference in March of 2011, HRG confirmed the capability: "We already have five or six direct connects today, but these are not mainline carriers," confirmed Bill Brindle speaking at the conference.

HRG is not waiting for someone to declare a winner - they are ready now for the changing nature of the supply chain system in Travel. Perhaps some of their competitors need to adopt a more open approach that mirrors this capability - or risk being left in the dust. The bigger tech players who come from the OTA world clearly have the technology to directly connect. Whether they choose to embrace it as Expedia has or actively work against it as Orbitz and 48% owner Travelport have comes down to a punt on the future. For American Express who has quietly mothballed its long time project of Travelbahn and others who are players in this space follow the open platform path or the closed traditional dependence on the legacy GDS will likely define their future success.

Corporate customers don't necessarily see the issue as being as essential as the agency community does. They know ultimately they will be picking up the tab. Their focus is on serving the traveller. For most corporations - the debate of limited ubiquity of the one-size fits everything GDS vs the pragmatism of offering a comprehensive and open supply chain to service the customer is interesting academically. While the finance departments may be concerned with operating efficiencies the fundamental role of a full service operation trumps any operational cost savings that might accrue from just using a GDS as the sole source.

Perhaps the most telling of the situation was Radcliffe's comment of how he views the war between the legacy GDSs and the airlines. "...But, clearly, something is broken between the two of them."

Images from FT.com and TTU.

Thoughts On the News Of The World

Truly they say the sins of the fathers are visited on their children ... so it is that Murdoch the younger one James (well at least the current fave) had to take the fall for the goings on at the News of the World.

For those of you who have never read the News of the World - the largest selling English language news paper - you have been missing a treat.

Here is just a brief sample from the website today:

http://www.newsoftheworld.co.uk/notw/exclusive/e_news/1340855/Prince-Harrys-better-than-Jenson-in-bed-says-new-girlfriend-Florence.html

I leave the link in the clear so you can appreciate the artistry of the headline and URL writing.

This is British Tabloid journalism at its finest. However sadly this is to end on Sunday July 10th 2011 when the last edition will appear. Thus ending 168 years of sensational and truth bending yellow journalism.

The organ known variously as:

NOW
News of the Screws
The Church Times

and other less than subtle or kind words. Old man Rupert Murdoch has leveraged his ownership and profit into a number of UK based businesses over the years. Now his sons are running the business and possibly his daughter too.

Closing the News of the World is a bad decision in my view. The management and News International's supervision of the paper and its staff are the problem. The Newspaper with all its sleeze and junk is only the product of people.

Who did what and how that was approved was plain bad and wrong and the people responsible should be punished. Shuttering the venerable newspaper as a result is a waste. At the very least the organization should have put the paper up for sale.

Are there some lessons here?

yes - brand value no matter how deep can be lost easily and quickly. This is probably an example of come-uppance for the paper that has raked mud over any celebrity from A listers to D Listers.


Cheers

Herb Still At It

Southwest's Herb Kelleher is still out there giving advice and chain smoking.

In an AP piece published in the Seattle Times amongst other newspapers, he gives his view on a lot of things.

The article has one of his best expressions - one I love.

"It was a contrarian decision - it followed my old adage that if it's common it's not wisdom, and if it's wisdom it's not common." Let's hope that someone gets this message.

One nice quote was the following one:

Q. Consolidation makes sense for the industry. What about consumers? Should they be worried about consolidation?

A. There's been a tremendous amount of consolidation that's gone on in the airline industry since I started out. There are far fewer carriers in terms of carriers that failed and carriers that were acquired. There's no more Pan Am, there's no more Eastern, there's no more Braniff, there's no more Western. Every time that that has happened, people have voiced concerns about diminishing competition adversely affecting fare levels, and it's never happened because the airline industry is still enormously competitive compared to other industries. When your principal capital asset can be moved 1,500 miles in three hours, strike anywhere within that length of time, you have an industry that's enormously competitive.

I do worry about competition in the space. I worry that consolidation brings overt market control by the supply side. But he doesnt... time will tell.

Cheers

Is WAYN For Real?

I am sure that Kim is very nice but I have no idea who she is and why she has anything to do with my travel.

Well WAYN seems to have a secret sauce that thinks that I as a dirty old man will like Kim. And that she (personally) has been dying to know what I think of her. As I while my time away with my head in books as opposed to living on Facebook or gawking at girls on the WAYN site, I hate to disappoint both Kim and WAYN but I am not interested.

So with all due respect to Kim and many other girls that WAYN has been sending my way for some nefarious reasons I will decline.

One day perhaps they will just stop doing it. But in the mean time - it is clear that WAYN like Florida Orange Juice - isn't just for breakfast or any other time of day for that matter.

Cheers

Travelport Ends Air Malta Agreement

In a galaxy far far away....

In a former life - I worked for Worldspan. In that job - one of the things we did was to break conventional models for airlines and distribution.

My team built a solution which let an airline have the benefit of a GDS connection in their market without having an onerous GDS contracting scheme to go with it. This solution was delivered outside of all conventional wisdom at effectively zero cost to the airline and no incremental cost to the agency community. Over the years it returned a nice revenue to Worldspan and then Travelport after it.

While this was not the first time that a dual mode terminal had been delivered in a market - it was the first time and as far as I can tell the only version that enabled a cut over of seamless nature in a market at really no cost.

Today's market costs by the GDSs are very different from the agreement that lasted more than 18 years in Malta. Travelport and Air Malta have announced the end of the agreement.

So hats off to all the team who worked on this project, to the airline's management who understood the value and to an era that has long gone replaced by a higher cost structure that ultimately adds cost to the passenger's ticket.

Cheers

Why I am Tired Of Working For Google...

One of my pet peeves about the development of product today is that as a user I am expected to do things over and above and beyond being - er - well - a USER!

And really I am SO TIRED of having to tell Google what is crappy about their system.

And here we have it again. Another Lite product from the Googleplex. You would think after so many failed efforts in the Social Space to replicate or combat (or both) Facebook that they would put out something that was more fully featured and well frankly not as lame as Google+.

AS we saw Google's first efforts in air - the schedule tool - is pretty darn lame to start with. And we should no longer be surpirsed. What we are seeing is that Google's output is increasingly built on a familiar formula.

V1 - TRUE beta - lame product with a lot of promise and minimal functionality.
V2 - the first real effort based on what the Googleplex drones have slaved away to develop for the hive. The drones have in most cases no idea what they are doing but the Acolytes take the overt and the covert learning and try and built a product. In the early days this used to be pretty good - but lately it has been more like a microsoft V1 product.
V3 - the first product that actually functions properly - typically delivered 2 years after V1 and the first to have the word "BETA" removed from it.

Google+ is following this very tired formula.

Yes I am tired and frustrated with Google for doing such a poor job. With all your squillions you should consider paying us rather than pocketing the cash and making us pay with our increasingly shorter leisure time.

So am I an unpaid Google worker? Yes. Because they take my data and manipulate it. And yes because they steal time from me with their less than perfect apps that make me work their way, not the best way.

Of course I could just stop using Google and its applications.

Couldn't I?

........ message terminated by order of the Googleplex.

PROFESSOR’S TRUE NOTE. As soon as I wrote the word – GOOGLEPLEX – my Blogger account started showing an error. Coincidence or are the REALLY watching.

MySpace Goes For A Pittance

This is really rather sad. It also demonstrates that big media still doesn't get social media.

So now we can see how the damage works

Murdoch's NEWSCORP purchased MySpace 6 years ago for $580 Million. Now the troubled site has been sold on for less than $37 million with NewsCorp retaing 5%. Specific Media is an ad business and will likely treat MySpace as a vehicle of nefarious ad laden overhead.

Sad really

AA Changes Boarding - Interesting Take

So American Airlines is changing boarding to by the time you check in.

No big deal you say?

Actually it is. Check out the local newspaper story.

Now what is interesting is two major factors. One is to do with Carry on and the other with boarding efficiency.

With carry on there are no US flights where all the bags fit. So the airlines bag fees have resulted in different behaviour. IE people try and carry on as much as they can. For AA this has resulted in an interesting characteristic. They try and load passengers quickly but quietly offer no charge bag tagging at the gate. Clearly this practice has become widely known so the resulting potential revenue loss is not insignificant lets say $100 per flight (4 bags @$25 per bag). With AA moving more than 3400 flights per day on average this could add up.

Yup that's a cool $31 million a year.

Let's now consider the airport operations issues.

The airport boarding process is one of the least liked processes for a passenger. Right up there with TSA Screening but we are not touching that one right now.

The problem is that everyone wants to board at the same time. It is a hydraulic problem. Getting the people fluid into the vessel. However if you are a long time reader of this blog - you will find that I have examined this issue before. Random boarding beats everything but some very specifically controlled boarding. So randomly boarding people at different points on the plane was one of my suggestions based on check in number.

Seems AA is a good follower of the Professor and agrees. So this is now likely to speed traffic through the boarding gate.

How well it works - TBD.

Cheers

Sabre AND Travelport Take Big Steps Outside Air with New Hubs

While Amadeus has been retreating to focus on the air business - the other guys seem to be going the other way.

Sabre announced the major acquisition of Softhotels which will beef up their Hospitality business - already a vibrant component of Sabre and a major force in hospitality.

Travelport - free of the GTA boat anchor business - has now started a new Agent based leisure service for non-air.

Both of these announcements demonstrate the need of the core business to expand. As the GDS component of the Big 3 GDS companies declines and the market moves to a more open model - we can expect this form of behaviour.

However - for those of you who watch the space carefully - will this be a worthy replacement for the standard GDS business?

Well in my view the GDS yields will be hard to find replication for Travelport unless the former sink below 20% which seems to be on the cards. For Sabre this is a complimentary business and looks to help them in their quest to edge Pegasus out of the nest as the central player in Hospitality distribution.

Are Your Really A Consumer Lover?

Announcing the first Witovation Awards.

Are you a real Consumer Lover? Do they love you back?

Well enough Rhetoric. Show me

Check out the criteria for the awards here and get that presentation together. An esteemed team of judges will be joining me in determining the ultimate Customer Lover.

Go on - put your money where your mouth is.

Cheers

Understanding Groupon and Living Social

I am not a fan of the Groupon/Living Social Model. I fact I detest it. It just smells bad to me.

However - clearly the consumer's like it. So it has value. But this is a zero sum game which is so blatantly obvious that either I am stupid... or they are.

So have a read of the article from eMarketer. It does show some interesting dynamics of the two players.

Sadly it just approaches things from the consumer end not the supplier end.

But worth a read anyway


Cheers

Why I Hate The Manipulation Of Search

Hands up those who think that Search is ALL of the following:

Honest
Easy
Consumer Friendly
Pure
Ethical

Right - all you Google Acolytes can put your hands down now.

I thoroughly dislike the manipulation of search. I hate that SEO has become synonymous with all that is dirty and ugly on the web. Back when the web was young and Google was but a glint in someone's eye, we used to worry that because the web was like the Universe - limitless. Therefore making money on the web was going to be hard as you could never own a piece of real estate long enough for it to have any value. Web Homesteading meant any person could put out his shingle and start selling stuff. The downside was that we could hardly find anything. The upside was that this was the purest. It removed the barriers so that the little guy could compete with the big guy. It was going to be the great leveller.

Today - we have the massive gatekeepers like Google (OK so the Googleplex IS the gatekeeper). Which in turn means we have to play games in order to get any presence. And this means we have to resort to - I can think of no other way to express it - but to call it cheating. In order to Optimize your abilities - you have to get on the Hamster Wheel and run that mad just to stay in place.

The different tricks that people get up to are indeed all over the map. And we are spiraling down to more and more extreme forms of cheating.

Let me just put up a few examples:

Unscrupulous SEO advisers, digital agencies and even individual companies some of whom are quite reputable (normally) engage in these practices.

1. Put keywords that include brand names of your competitors. While largely stamped out this practice remains prominent

1. Freelance blog for money commentators who are usually factory farming people writing from home or in low cost countries who mascarade as real bloggers or commentators. These people are trained in techniques that they can use to commentate. They are literally nothing more than robots. ( would hazard a guess that some indeed are machines now). I have been getting quite a few of these appearing on my blogs.

2. Fake people. a 19 year old professional "faker" masquerading as a 35 year old housewife from Stockport replete with fake name, normal sounding email and other persona credentials.

3. Compensation mechanisms which are tied to the latest version of Google's algorithms. (EG Panda v1 and v2).

For a great list and discussion on this topic go to InfoWorld here.

And who is to blame? We all are.

However I think there are ways to do something about it. Firstly the consumer is tired of this and HE/SHE KNOWS YOU ARE CHEATING. So anyone who thinks you can do this and get away with it - you might gain some short term advantage.

For my part - I believe that one of the drivers of Social Media is that the Trust of the peers - are helping to raise the stakes. But now we have "Fake Social" peers who are attempting to become arbiters of this Trust. I have about the average number of "Friends" in Facebook and a larger number of Linked in contacts. I routinely weed people out and only accept people I know personally. However fakers still slip in.

All of us have the responsibility to route out these fakers and cheaters.

So think about this today - go into your Facebook and Linked in Accounts and remove people who are not personally known to you.

Cheers

FTC FINALLY Opens Up Broad Review of Google’s Market Dominance.

As I have pointed out over many a blog, In my view Google as a company of one. It cannot be judged by any precedent. Because frankly there is none. FTC to Serve Google With Subpoenas

No other company in the history of technology has held as much power and sway as the now sits in the hands of Larry Sergey and Eric. Google’s protestations to the contrary – they are now clearly a company that transcends the ability of any single government’s ability to control them via conventional regulatory means. The law – arcane and archaic as it maybe does have one or two tricks up its sleeve. Based on its limited controls – the US Law allows the various instruments of the US government’s executive branch to determine anti trust behavior. It is here that the Department of Commerce in conjunction with the Dept of Justice has come with the conundrum of what to do about Google.

While I believe that there are few if any Google employees who are outright evil. The ability to exert that power is just too strong. Google is doing bad things. This will come out in the investigation. But as regular readers know I am a strong believer in Newton’s Second Law. I firmly believe that Google is doing bad things through its lack of effective oversight of its employees who are in many cases determined to crush the opposition to anything that will get in the way of the Googleplex Borg. It is not – thus – that the people are doing bad things- but rather that they can manipulate a marketplace by either their direct actions or their withholding of certain facilities or even just by trying to do one thing – Google will (and yes sometimes inadvertently) effect a change in the marketplace that benefits the company. My opinion was that there was little that the US Government could do to prevent the Google acquisition of ITA Software. This proved to be right. BUT Google has stepped beyond the role of a conventional marketplayer.

Google knows this and its people know this. But Google has not yet put in place those controls to prevent damage to the marketplace. Google therefore has therefore been allowed to “get away” with things in the past. In my view this has only emboldened the Google Acolytes to behave even more without constraint. Should the Government have stepped in before? Yes. But they chose either through lack of direct evidence or through negligence or even because they lacked the resources to engage the giant. No matter – the decision has been made to go after them.

Am I right or wrong? On the one hand Google’s resources may indeed be greater than that of the Government’s ability to pursue this case. Thus there is no sure thing that the US Authorities will prevail. On the other hand successive US and International Authorities have failed to place any controls on the tech giant. As it evolves into a product based company from being a pure search utility – it has blown through many control gates.

In travel their power is not absolute. However do they have the ability that they can and will use? In my opinion yes. The lackluster appearance of Google Places for Hotels and the mediocre Google flight product may be a harbinger of a somewhat less than stellar product that will come from Troogle. But make no mistake – these are first generation products and Google will do better. So before these products start to appear to dominate the market, we need better controls. Well sadly it is too late for that. We will get products from Google’s cash pile that will kill certain players in the market. Some of these players probably will deserve to die. But others will be harmed irreparably. There will be “Mapquests” in travel. Indeed let’s be clear here – in travel’s case - there will be some “victimless” crimes. But there will be victims and that awesome power has yet to be revealed.

But by any measure the company is a monopoly and therefore its power must be curtailed. However that is achieved will determine much of what we can and cannot do in the coming years particularly in innovation will shape not just the Travel Industry alone.

I urge you if you are a new or occasional Reader to type the word “Google” into the search box and read some of the posts I have written before. Wander through the Professor’s prognostications. This represents my opinion. Let’s hope that both common sense and the what is “right” rather than what one company can do with its power prevail.

Everyone is entitled to an opinion. This is mine. Please feel free to write to me and tell me how you feel about this.

Cheers

Delta steps into the Dog Poo CORRECTION SEE UPDATE

PLEASE NOTE CORRECTED INFORMATION AND POSTSCRIPT BELOW

Skyteam has come from a late last place to a good second with Star retaining its global dominance in airline alliances.

However along the way – as the key players have been snapped up and now more than 70% of all global airline traffic can be booked on one of the big 3 alliances – there was bound to be a cultural problem or two.

And sure enough there is. As the Huffington post is reporting – Delta passengers on the code share flight with SV-Saudi Arabian Airlines (also known as Saudia) must comply with Saudia’s rules. This includes..

1. No Jews or Israelis
2. No Outward displays of religious affiliation other than that of Islam
3. Women must be accompanied by their husbands or a close male family relative
4. No transportation of religious artifacts of the Christian or Jewish or indeed any non-Islamic faith.
5. Oh yes and don’t expect any Martinis on the flight.

CORRECTION: DELTA IS NOT CODESHARING WITH SAUDIA.
When I checked the story to start with I could not find any DL Code shares out there with SV. Now I understand that Delta has issued a statement that indicates that they will not code share but will of course (as they do today) still interline.

This is of course well within the right of Saudia to insist on this policy which has existed for many years. Further entry into the Kingdom of Saudi Arabia (KSA) is governed by the same level of restriction through its strict Visa program.

EVERY country has the right of self determination, however – Code Shares across boundaries somewhat messes up the global order. OK for conventional arrangements but not for situations like this. So what is Delta to do? Hmmm – someone in International planning is probably sweating bricks right now. Cultural sensitivity is always hard. So the simple answer is that you hope and pray that the controversy blows over. Fat chance. You can cancel the agreement and then Delta becomes the symbol of American Jewry to all Islamists. OR Delta takes a pragmatic approach that is all inclusive. IE That on DL served flights the rule applies and non DL operated flights those rules apply. If then those who arrive in KSA with these bad things – then they have to accept the consequence. BUT DL must now accept that it has to operate some of these flights rather than allowing SV to operate all DL coded flights to KSA.

Clear?

Good luck…

Cheers

EDITORIAL ADDENDUM

This makes most of the point of my story different in the narrative. However my point is writing the story in the first place is that these restrictions will occur no matter what happens. There are different policies some of which are governed by national requirements, some are operational requirements. As a frequent flyer I am exposed to these issues ALL the time. It is an occupational hazard of code sharing. I have pointed out in the past that the so-called seamless experience between carriers is a myth.

As the practice of code-shares proliferates then you will find more of these types of situations emerging. And that was the point of this story. Thanks for reading!!!!

What Cloud Computing Means To Open Airline Distribution

This is a modification of a response to a discussion going on in the Beat.

I have just returned from 2 days of the SITA IT Summit. I believe that it has finally dawned on the airlines that they need to do something about the control of their content. And voila... along comes the very essence of the tools to do this. Apps and the Cloud. What has been missing is a viable product and content delivery mechanism that enables the airlines to easily connect and the users also. The structured nature of the industry is artificially constrained by older and now increasingly irrelevant mechanisms. The reality of today's world is that NO ONE has any right to impose ANY STRUCTURES on any user community. I am not preaching anarchy, just acknowledging what the consumers are expecting of us in the industry to deliver.

The open web has enabled us to enjoy almost unlimited access to content. However that content has been constrained by the structures of those who believed that they are the gatekeepers. And they still believe that they can control that and impose the relevant taxes for the privilege. Cloud Computing, Open Systems and low cost app development with rapid deployment and mass consumer adoption all conspire to blow away these archaic legacy structures.

What has been missing is the delivery mechanism. Clearly Cloud Computing does that - but the airlines need a common delivery infrastructure to do so. One that enables the distribution of product and content in any way shape or form. SITA is stepping up to that plate with an Airline Community Cloud. This is but one of many potential options - but for the first time we will have such an Open Delivery platform that can enable true freedom of distribution.

Then next generation companies such as LUTE Technologies who provide aggregated and common services can compete fairly with the legacy players such as the GDSs.

LUTE does not impose rules and restrictions on either side. We provide splintered or common content. We enable unique bilateral dialogues without restriction. All via the Cloud. The owner of the content decides what he wants to sell. The consumer decides what he will use. This is a balanced and logical way to do things.

So rather than moaning about how the lack of ubiquity (aka the lowest common denominator of content) which is the gripe from the intermediary community - they should now embrace the fact that they can TRULY differentiate their services and provide value both up and down stream. Most importantly they can provide really valuable services to the community that they are (and hope to continue to) service.

Idealistic? Unreasonable? Unachievable? Hardly. This is real folks. The incoming Gen Y and Millenials who are replacing the Baby Boomers EXPECT - actually - DEMAND this level of service. if we don't do it now - then someone smarter and faster will.

So stop whining and embrace the real world. Now can we stop debating whose control is better? Let’s devote our energies to servicing the customer. GDSs need to either embrace or go away. But I don’t worry about that any more – the Technorati have spoken. Now the airlines realize that in 3 year’s time, 58% of their distribution will come from non-GDS channels. Actually I think that number is way too low. Open Clouds with deployment of new functionality in minutes rather than years will crush the structured legacy models.

Cheers

The Flip Side of LBS - Cyber Stalking.

Al Franken - Comedian no more - at least not for the next 18 months - is a Senator in the USA.

He is also very liberal. He is sponsoring a bill essentially to prevent Cyber stalking using Location Based Services in your mobile phone.

You can read about the details in the following article.

The bottom line to this is at a combination of Apple and Google's over-reaching use of LBS systems, and some pretty sloppy coding by Android developers has resulted in not just potential by actual abuse. People forget Newton's second law.

Let this be a lesson

Cheers

DoT Toughening Up on Online Advertising

The US Dept of Transportation is increasing both its surveillance of online advertising for Airline related businesses.

Indeed there is quite a lot of legal constraints on what you can and cannot do/say.

The DoT has just fined Frontier Airlines for a transgression.

Last month several online websites were fined.

And don't forget that the cash strapped US States are also getting into the act.

you have been warned. Comply with the letter and the spirit of the law

Cheers

Ever Wanted To Know The REAL Seattle?

Then here is a way to learn it all in about 2 hours.

This week's A Prairie Home Companion came from Chateau Ste Michelle Winery in Woodenville just outside Seattle and near where I live. So along with a few friends and probably most of the local NPR Station's listeners (KUOW) I went along to listen to Garrison Keeler. It was a great show.

To listen to it (from Monday June 13th) go to the PHC website and down load the archive.

http://prairiehome.publicradio.org/programs/

Cheers