office systems.” Lufthansa similarly offers an agent portal and, as
mentioned, Air France-KLM’s is in the works.
Yet another way to avoid the surcharge is to book IAG-
operated flights through codeshare partners, including American
Airlines. This is true of Lufthansa and Air France-KLM, as well,
where codeshare bookings are not subject to the surcharge.
Ultimately, the GDSs themselves have embraced NDC. Each
of the major GDSs has put time lines in place for full NDC
compatibility. All say they will be NDC-certified at the highest
level by the end of next year, which means the technical capability will exist for airlines to control the content they distribute
via GDSs. What economic models will emerge among airlines,
GDSs and TMCs, then, remain to be seen. According to IAG’s
Walsh, “We’d like to have a relationship with the GDS, but we
think the traditional model is no longer fit for purpose, and we
need a model that works to the future and not one that is structured around the past.”
—Reporting by Jay Boehmer & Amon Cohen
in a very different way with corpo-
Still, there are other ways for
agencies to avoid the surcharge.
BA and Iberia have developed
cloud-based tools, including a cor-
porate booking portal for corpo-
rate clients and a tool for TMCs.
Through those portals, IAG is of-
fering the ability to book, change
and cancel BA and Iberia tickets,
including negotiated fares. BA and
Iberia’s portals also support cor-
porate policies and provide corpo-
rates access to ancillary products.
Further, the airlines are providing
“a standard XML feed for agents
to integrate to their mid- and back-
“There was a lot of commercial
discussion about who got paid and
how much. Now it’s about who gets
my content and how much.”
For American Express Global Business Travel and
some other large travel management companies,
the International Airlines Group is waiving its
new surcharge on bookings facilitated through
global distribution systems. BTN distribution editor Jay Boehmer caught up with Amex GBT EVP
of global supplier relations Mike Qualantone.
GDSs traditionally strike a deal
with an airline to bring content
to all TMCs and other subscribers. How is this model different in
terms of who’s at the table?
One-size-fits-all doesn’t work, right? So one-size-fits-all is Lufthansa putting a surcharge
that everybody has to pay. We don’t think that
works. We would rather work with airlines and GDSs to solve for our customer needs. What [IAG airlines] BA and Iberia realized was: One size does
not fit all. So there are certain relationships that they want to continue to give
full access to content, that they don’t want to have to surcharge and that they
want to try to make ongoing efficient bookings available.
[Amex GBT] is a customer that gives them high-value bookings, and they
value the relationship. The problem they have, I would guess, from an airline side is: If they give their content to the GDS ... it has to go to everyone.
You have certain agencies that may sell a predominance of low-value tickets—coach, highly discounted, pre-purchased—and you have others that
sell more business, more full coach, more ancillaries, more first class. Those
relationships are more valuable to an airline.
When I hear airlines talk about New Distribution Capability, they talk about negotiated bundles, more tailored offers and better access to ancillaries. Are there
opportunities for enhanced content?
There is. Our objective is to work with the GDSs and BA and Iberia on
a way that can make sure that content can be consumed in the GDS.
Honestly, the GDSs have been slow to create the right integration of
ancillaries to easily sell them in the same transparent and efficient
environment without adding costs. We believe ancillaries is an example
where, if we don’t see a more efficient environment [in the GDS], we
can work more with the airlines on how to better sell or promote it to
For so long, the airline has paid the GDS a booking fee
and the GDS has paid an incentive back to the agency.
Are there differences in the economic flow with this
kind of “private channel” arrangement in which certain TMCs can work through the GDS without penalty?
Our intent was not to change distribution economics. It’s not our intent to
use this as a way to try to make more revenue for ourselves. It was about
trying to find a solution. Money flow I really can’t comment on, but the
economics themselves should not change. The thing that you see more
now than earlier with distribution discussions over Web fares and these
other things that transpired over the last several years: There was a lot of
commercial discussion about who got paid and how much. Now it’s about
who gets my content and how much. That’s a bit of a different discussion,
right? That’s something in the GDS contracts known as the content parity, so I give [the GDS] all my content and you give it to everybody. That’s
more of a central issue now. What is the definition of content and who
gets my content?
TRAVEL EVP OF
How One Mega TMC Views Its
“Private Channel” Privileged Access
to IAG’s Full Content on the GDS
“We are clear that
increase in costs.
This is in the
short to medium
term not a cost-
reduction issue. In
fact, it will add to
—IAG’S WILLIE WALSH