Tag: airline distribution

From deregulation to automation to online – 40 years of distribution

DEREGULATION Deregulation of the US Airline Industry in 1978 brought enormous change to the US travel landscape, making entry into new markets accessible and entry as a new airline much more feasible.  Deregulation took us from 60 airlines in 1970 to 90 in 1978 all the way to 192 airlines serving the US in 2010. […]

Read More

Clarification in terminology – Direct Connect or Supplier Direct

Thanks to Jim Davidson for his comments on The Beat on my post on Channel Shift (see below for his comments in italics).  Jim is right.  There are two things at issue here.  DIRECT CONNECT – Farelogix provides a technology solution to suppliers which they refer to as the “Direct Connect Distribution Model” that allows […]

Read More

Don’t be fooled. Direct Distribution is not free

Click here to read previous story Looking through a single lens can be hazardous I sit, admittedly somewhat amused, by suppliers that look at their distribution options and discard what they deem as “higher cost” channels in favor of direct distribution.   In May, I wrote about what happens when you only look through one lens […]

Read More

Distribution Basics: The cost of producing an airline booking

At issue in the war between the airlines and the GDS, are a number of things, but first and foremost is the one of cost. I believe the real issue is that the airlines don’t believe that they should have to bear the high cost of the GDS’s legacy environment and would like to see […]

Read More

AA/Sabre Dispute: All is quiet on the western front….

For the time being, June 1st is not the cataclysmic event that had been predicted, but the engines have not been turned off in this game of chicken, at least not just yet. This morning, Travelocity (powered by Sabre) still has AA prominently displayed and the travel management companies that we serve still seem to […]

Read More

Distribution Fundamentals: Looking through a single lens can be hazardous

Any first year MBA student already knows that in order to see the profit picture clearly, you need to look at both revenue and cost. The sunglass graphic at the right is one that I created to make this very basic point. Most of you have played the game of covering up one eye and […]

Read More

Is it time to “make nice” with the offline travel agency distribution channel?

Sharpening conflict online between OTAs and Airlines renews discussion about the value of the offline distribution channels – namely the mega agencies that focus largely on the corporate traveler and the other, nearly 16,000 brick and mortar agencies still in business in this country. As we listen to the media talk about the Expedia and […]

Read More

The hubbub over American Airlines online

I find it interesting that the travel industry, and online travel in particular, believes that it has the birthright to display 100% of all travel supplier content. Conversely, that suppliers should take for granted that all distribution channels should have the obligation to distribute their products on their terms. In any other retail environment, there […]

Read More

Stop the Madness – Some simple steps toward profitability

Today I have been working on finalizing a market assessment report for a client and I have to tell you that I am once again astounded by our very own airline industry.  Please don’t get me wrong.  I like to fly.  Well, not really.  But I used to like to fly.  We had legroom, hot […]

Read More

Correction on yesterday’s post on online travel agency decline

CORRECTION TO 5/17/2010 POST According to ARC, the current air ticket sales stats actually show the OTAs still growing year-over-year, with the RATE of growth declining a bit (see the chart in the original post).  Clearly the rate of growth in business travel via the Megas is making the OTAs growth look more mild, but […]

Read More