Direct connect services by airlines to TMCs will “limit competition and drive a lot of people out of business” Elisabeth Martins, Sabre’s UK country manager, said.
She said such services did not provide all the information TMCs and travellers needed whereas a GDS like Sabre was connected to 400 airlines.
Martins was speaking at the advantage Conference in Madrid on a debate on distribution in the light of the row between American Airlines and Travelport which owns two major GDSs, Galileo and Worldspan.
She said the distribution costs of an airline were about 1% of their total costs but two thirds of their passengers booked through GDSs.
“We as a GDS invest a lot of money in getting a one second response from our 400 airlines to provide fares and ancillary prices. I do not see that from direct access. It provides complexity and the consumer is the one who is going to pay for it,” she said.
“I do not believe airlines are paying too much.”
But her views were rejected by Jerry Dunn, distribution development manager for easyJet.
He told delegates that the low cost carrier had been working with GDSs for three year and wanted to engage more with them.
But easyJet was also a mainly a direct sell airline. The two ways allowed the airline to connect both to individual TMCs and GDSs.
He said GDSs were in an “ideal position to empower a fairer fee model but they should not be dictating an airline’s strategy”.
Legacy carriers still had a very high proportion of sales through TMCs and GDSs. American Airlines for example, spent $1bn a year on distribution “which is a lot of money”.
But Dunn said that if you looked at the musical industry, sales of CDs and DVDs were falling as people were downloading. “You can’t stop change”, he said.
Anne Godfrey, CEO of the Guild of Travel Management Companies, who was attending the conference as an observer, remarked: “I have never seen an industry that makes things so difficult for itself.” Direct Connect will “limit competition” in travel industry