As more airlines make signing up to Prism a prerequisite our anonymous travel buyer asks whether this is a positive thing or not.
A number of airlines, particularly in the US, and more recently the likes of Virgin, Cathay Pacific and British Airways, are increasingly making signing up to Prism a prerequisite of contracting with them.
That means we sign a data release authority (DRA) and send it to our travel agent. That authorises them to hand all our data to Prism and the airline gets a swathe of reports on the tickets we have bought.
So if we use American Airlines, they can see all the tickets we have bought between London and New York in both directions, and they will see that their share was 17 per cent.
The reports won’t break the information down to individual classes within a cabin, they do show information such as business class, that the average fare paid was X on American and then the average fare on other airlines as a total would be Y. Then they can come to us and say we are getting 17 per cent market share and yet our average fare is lower than the others, so why aren’t we getting more market share? That’s one element.
The airlines will sell it to you as a positive. They tell you it will highlight opportunities for them and also for you: we just noticed you are doing a bit of traffic between New York and Miami and that’s not in the contract, we would like to give you a deal on that route. But the number of times they use it to beat you up, because they’re not getting the share they think they should, is disproportionate to the number of times they come to you with an opportunity.
However, this is my biggest concern: I give London-New York as an example because British Airways, American, Virgin, Delta and United are all serving that route, which is quite a lot of carriers. But if you take London-Kuala Lumpur, as of next year there will be two carriers, BA and Malaysia Airlines, both of whom would like you to sign up to Prism. The report from Prism will still say ‘others’ but you know who ‘others’ is because it can only be one other carrier. So if it’s a BA report, you might as well say ‘that’s ours and that’s Malaysia’s.
Fair practice?
As with a lot of travel departments, we report into procurement. I don’t know that many procurement people who are aware of another commodity like air travel, where the vendor is in receipt of what you do and whom to do it with. We provide data to the airlines for any meetings we have and we give the data they ask of us; we give them anything and everything that Prism does, except for the average fare on other carriers, we’re more protective of that.
Our TMC in the UK has a consulting arm that does our airline RFPs. It has two corporate clients who are looking at this from a data protection perspective, and considering challenging whether it is fair practice.
I’m assuming airlines are paying quite a lot of money for this data, which is why they are so insistent on us doing it. I wouldn’t have thought they’d be transacting with Prism if they had not done due diligence. It is quite ironic, because I’m sure that somewhere in our contract, it says we are not supposed to disclose our fares to other carriers – and yet that’s almost what they are asking for.
Another issue is that the DRAs are open-ended agreements. Someone from our company in the US signed a DRA with Prism for British Airways a few years ago, and they were getting data that we didn’t know about. So we put a stop on it and terminated all our existing DRAs when the last deal finished, so if they wanted a DRA, they had to negotiate it; they can’t have it on a rolling basis. BA had to sweeten the deal and give us back something that they had taken out.