Credit Suisse First Boston white paper issued last month boldly proclaims that there will be a sea change in the way cruises will be sold in the future.

Noting that "85% to 90%" of cruises now are booked by traditional travel agencies, CSFB predicts that by 2006 the percentage will be only 60% to 63%, with 25% being sold supplier-direct, and online penetration growing from 12% to 15%.

A critical observation in the study is that traditional agencies underserve cruise lines. The authors note that although 71% of first-time cruisers say the experience "exceeds expectations," only 12% of the population has cruised. "This disconnect suggests a distribution problem," the paper's Executive Summary states, and everything that follows is predicated on this assumption.

As might be expected, travel agent leaders and cruise line executives I spoke with had very different views on the accuracy of the report. But contrary to expectations, the heads of two travel agency groups -- each representing thousands of outlets -- told me they believe their members' fate is accurately portrayed in the paper.

On the other hand, cruise executives I spoke with felt the report was unrealistic. "It is, to put it kindly, very aggressive," one said.

Although the report raises interesting issues, its statistical setup undermines its credibility. According to a cruise analyst at a different firm, the data citing cruisers representing 12% of the population is misleading because it includes people who aren't in a position to decide to cruise, either because they're too poor or too young. Filter out the ineligible, he said, and the number becomes 30%. There are some other funky numbers in there, as well -- the report states on the first page that "just a few years ago, traditional agents were paid 15% to process air tickets."

The CSFB analysts observe that Orlando and Las Vegas combined outsell cruising 6-to-1, and again blame the "bottleneck" of agencies. But where's the connection? Agency efforts on behalf of cruise lines have resulted in ships sailing at 100% capacity in the toughest climate the industry has ever faced. An alternate conclusion might be that there is insufficient capacity for existing channels to reach their potential.

The report rightly wonders if agents are "selling the discount, not the product." This, in my mind, is the strongest argument the report presents for the lines to pursue alternative channels (and why the agency leaders I spoke with may believe in the report's accuracy -- they know agents can do a better job). But the channel-shift CSFB proposes (and calls "healthier" and "positive") puts more emphasis on channels that, so far, are utilized primarily to promote discounts. CSFB said new technology will help simplify complex sales, but cruise officials I've spoken to aren't buying the time line.

The report believes agents reach too narrow a segment of the population, and that this inhibits the inflow of new cruisers. A valid concern. But as long as research shows that people who use agents take more and longer trips and spend more money than those who don't, agency clients remain an attractive target.

The paper raises good questions. There just seems to be a disconnect between the questions and conclusions.

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