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September 2022, Virtual
September 29 2022, Virtual
IATA wants to produce an “Amazon-style” shopping experience for airfares through its controversial New Distribution Capability (NDC).
The association unveiled NDC at its World Passenger Symposium in October which aims to produce a system which “tailor-makes” each air booking for individual customers.
But trade organisations fear that this move will make it harder to compare airlines’ fares and there has also been criticism of a lack of consultation by IATA over the process.
IATA chief executive Tony Tyler said that the aim of NDC was to ensure that “the shopping experience at a travel agent is as robust as what you would get on Amazon.com”, during a speech at the association’s global media day in Geneva yesterday (December 13).
“What exactly is NDC? I cannot draw you a picture of it or even describe it accurately in words,” added Tyler.
“We are developing standards with a vision to enable airlines to provide more information to their customers to help them make informed decisions on air travel.
“That will enable innovation and invite competition into the distribution space, and that will make the shopping experience for travel products much more modern.”
Tyler again criticised GDSs for offering “limited information” for airline bookings made through the travel trade.
“We expect that developers - including today’s GDSs - will seize the business opportunity to develop much more modern distribution systems,” said Tyler.
“NDC will facilitate new entrants into the market as well as creating new opportunities for the GDSs. And that alone has got to be good for consumers who will also benefit from greater consistency in products and services offered across the different distribution channels.”
Trade groups such as the Guild of European Business Travel Agents (GEBTA) and European Travel Agents’ and Tour Operators’ Association (ECTAA) have filed letters with the European Union expressing concern about NDC’s potential impact on competition and the transparency of airfares within the aviation market.
IATA has also released a report entitled The Future of Airline Distribution – A Look Ahead to 2017, which has been written by written by Henry Harteveldt, co-founder of Atmosphere Research Group.
The report said: “What airlines don’t want are distribution channels that present all airlines as equally substitutable commodities.
“Airlines want, and expect, their distribution partners to offer passengers helpful contextual information to make well-informed purchase decisions, reducing the number of reservations made based primarily or exclusively on price.
“Airlines also want commerce platforms that can support extensive fare and product transparency, dynamic pricing, rich basic and ancillary product merchandising and retailing, and the ability to reliably and securely process the massive volume of shopping sessions.
“Importantly, airlines are also eager to see new providers enter the airline distribution/commerce space.”