IATA's goal to have 20% of airline sales powered by a New Distribution Capability (NDC) API by the end of 2020 is an ambitious one. Yet developments this week should help the airline association achieve that goal.
Today, SAP Concur has announced that NDC content from Lufthansa Group airlines and British Airways will be available to all Concur Travel customers and their TMCs.
Ian Luck, head of distribution at British Airways. "Our aim is to give our customers choice and offer multiple options to purchase British Airways flights and products in a way that best suits their needs, while also providing access to new fares and products that are enabled by our NDC capability."
This week, Click Travel, British Airways and IATA have announced a joint pilot for Settlement with Orders (SwO), a new project aimed at making payment for changes and refunds of air tickets much simpler.
SwO is a development of NDC and ONE Order, IATA's 'super PNR' which includes customer data, order items, payment and billing information, fulfilment data and status.
The current trials with NDC have largely been focused on the selling part of the business. The SwO pilot focuses on back-office processes.
The changes promised by SwO really comes to the fore when you look at making changes to a ticket or requesting a refund.
Robin Smith, chief product engineer at Click Travel, says: "Settlement with Orders will automate what is currently an overly-complicated and manual process for all booking agents, meaning any changes, payments or refunds can be actioned much faster — which will only be a good thing for customers.
Now, with a single order number and communications over APIs using NDC, those changes can be handled in an automated way rather than by expensive manual processes."
BA's Ian Luck says: "Settlement with Orders will improve the billing and settlement process for both airlines and TMCs. It will simplify the IT infrastructure, remove process duplication and enable automatic reconciliation.
An offline pilot is set to take place in October and November, with a live trial due to start in Q2 of 2020. The pilot "is just to check the flows to make sure the integration is working before we move to the live pilot," says Smith.
If the live trial goes well then it will be a simple matter to allow other airlines to use the same process.
"I am expecting a lot of airlines to get on board quickly," he says.
What will be the effect of all this NDC-related activity for travel buyers?
SAP Concur says that the move will mean that buyers can now "avoid carrier-imposed GDS distribution cost charges". Airlines have also moved many of their cheapest fares away from GDS channels and have also started offering continuous pricing (as opposed to the traditional method of discrete fare buckets).
Charlie Sultan, SVP of global supplier and content strategy at SAP Concur, says, "We've heard from many travel managers that would like the extra savings these fares afford them."
With respect to the Click Travel SwO trial, Robin Smith says, "During normal transactions, they will probably not notice as they are quite automated already. What we are talking about is the unexpected changes, the costs associated with that and the ability to process refunds and exchanges in a quicker fashion."
So the big question is will transaction fees come down?
Click Travel's Smith says, "All the commercials around transaction fees are changing and as much as consumers want to reduce their transaction fees so do the airlines. We are seeing huge commercial changes across the board especially as we cut out GDS from the process. I wouldn't like to comment on exactly which way it will go but I wouldn't be surprised that conversations [about fees] will be triggered as a result of this."
Smith argues that NDC connections are bringing buyers "more competitive price points and a wider array of products".