Tuesday, March 12, 2019

Air India’s GDS policy penny wise pound foolish

Air India is always in news for the wrong reasons. The latest in its series of blunders is playing with a very technical aspect of airline business, sales and marketing, called the global distribution system (GDS).

GDS is a computerised network system owned or operated by a company that enables transactions between travel industry service providers, mainly airlines, hotels, car rental companies and travel agencies. 

There are currently three major GDS systems, Amadeus, Travelport and Sabre. Their respective share of the market is: Amadeus 55 percent Indian, 43 per cent global; Travelport, 30 per cent Indian, 20 per cent global and Sabre 12 per cent Indian and 39 per cent global.
All major airlines must necessarily be on multiple GDSs because if they are only with one, they are automatically blocked off from the others. As an example, if a call centre takes calls from only one telephone company, then it will not be able to service its clients who have phones from different companies.

Like most full service airlines, Air India had been using multiple GDS systems so far. This is in the best interest of the airline.

However inexplicably, Air India has decided to get rid of all GDSs in favour of  one. Air India has decided to use Travelport as their exclusive GDS and is giving up the rest of systems. This means that if a travel agent wants to book a ticket, he has to be on Travelport GDS.
12/03/19 Sanat Kaul/DNA