Booking an airline ticket is growing more difficult, and things are going to get worse. (And right – it wasn’t an easy task in the first place.) Airlines, online travel websites, and the tech firms that act as middlemen declared a turf war, and the consumer (you) could pay the price – or perhaps a recent dustup will go away quickly.
Vacationers have simple needs: They want to book an airline ticket online with little hassle. They want to key in a destination and travel dates, have a travel website spit out their options, and pick the best time/price available. That’s what computers do, right? Simplify data?
Under this turf war, however, the websites are spitting out fewer options, and travelers could soon get less info and pay more for air travel. While it seems counter-productive to make it harder on consumers, each airline, website, and middleman wants to make as much money as possible because that’s what companies do. If mucking up the booking process leads to more profit, they’re more than willing to muck away.
The simple version: Airlines want flyers to book directly on their company website rather than online travel websites such as Travelocity, Expedia, or Orbitz because they make more money on each ticket if they can skip the middleman. However, the airlines also need business from the people who visit big travel websites because that’s where most travelers go. Right now, the airlines (specifically American Airlines) are doing anything they can to wean travelers off the big websites.
How the process works
To get thousands of airlines, fares, and flights onto a single website such as Travelocity, the airlines rely on third-party vendors to act as middlemen – global distribution systems (GDS). A handful of GDSs crunch raw airline data that can be updated by the second, turn it into website-friendly data, and distribute it to travel websites.
Here’s the incomprehensible-to-mortal-man part: The airline’s contracts with a GDS have thousands of details, and some favor one airline over another. If 20 flights to Orlando cost $198, for example, the flights listed at the top of the webpage tend to get more bookings than the ones at the bottom, so an airline’s placement is important and probably part an airline/middleman contract. It’s not enough just to have an agreement with a GDS; airlines need a favorable agreement. But favorable agreements cost the airlines even more money that the airlines want to keep.
Southwest is currently the only high profile airline to nix the GDS firms from its business model. Southwest is big enough – and efficient enough and cheap enough – to build consumer demand without help. Most travelers know they have to go directly to Southwest’s website to book a flight, and they willingly go there. That, in a nutshell, is what the other airlines hope to accomplish.
American Airlines recently dropped out of some big online ticketing sites and is toying with its GDS contracts. If successful in shifting even a small amount of travelers from big travel websites to its corporate website, other airlines will try to do the same thing. If the pattern continues, the Travelocity-style websites will offer fewer and fewer airlines and possibly more expensive options. Consumers seeking their best deal could lose convenience and have to visit up to 37 websites to see all the Orlando-serving airlines.
On the other hand, airlines could watch American with curiosity, note a drop in booking numbers and American Airlines profits, sigh, and continue working within the current system. American would have no choice but to back down.
The dust has not yet settled, however. If planning an Orlando vacation, pay close attention to the quickly changing details.