SO-CALLED LIMITED TRAVEL DISTRIBUTORS, it turns out,
apparently have value. Sabre and other GDS vendors used to deride
alternative distributors like G2 SwitchWorks as LTD. But with
airline negotiations finished and a buyout in the works, Sabre
chairman and CEO Sam Gilliland recently held out the possibility of
collaborating with G2. Gilliland discussed the issue in response to
a question from a Sabre employee during a Dec. 12 conference call,
just hours after revealing that Texas Pacific Group and Silver Lake
Partners had agreed to buy Sabre for $5 billion and turn it into a
privately held company. Gilliland said TPG has a 20% stake in G2.
Gilliland noted that while Sabre officials haven't spent much time
talking to the new owners about G2 yet, working together is
"entirely possible." However, later in the discussion with Sabre
employees, Gilliland noted that TPG has a minority stake in G2 and
only one board seat. "So I think there's little likelihood that
there would be any collaboration there," Gilliland said.
SWITCHWORKS, reacting to Gilliland, said it was open to
new partnerships. "G2 is a company with a track record of
partnering with companies who share our innovative mindset -- with
ITA Software, Trisept Solutions, BookingBuilder and Navitaire being
some selected examples," said Ellen Lee, vice president of business
development for G2 SwitchWorks. "If it would expand our reach and
help us provide the best service to our existing and potential
customers, we'd be open to a discussing a business relationship
with Sabre, and other GDSs for that matter."
G2SWITCHWORKS settled their litigation, and terms of the
agreement were not disclosed. The settlement took place months ago,
on Aug. 30; however, the agreement remained unreported in the
press. Orbitz had accused six G2 SwitchWorks employees and
consultants, all of whom were former Orbitz employees, of pilfering
Orbitz trade secrets to develop the G2 reservations system. G2
SwitchWorks had countered that Orbitz allegedly was long aware of
G2 SwitchWorks' plans and even had discussed the possibility of a
joint venture, but the relationship soured when Cendant revealed
its intent to buy Orbitz in 2004.
AND IN OTHER
COURTROOM NEWS, the litigation between Travelport's Orbitz
and Worldspan, while still active, is in legal limbo with neither
party going to the mat with aggressive new motions for the time
being. That's because the $1.4 billion merger of Travelport and
Worldspan would render the litigation moot. Officials expect the
closing to take place in the second or third quarter of 2007, and
at that juncture the litigation would go away. In 2005, Worldspan
accused Orbitz of improperly using Worldspan data and other "GDSs,"
including ITA Software, in connection with Supplier Link
[direct-connect] bookings. And, Orbitz alleged that Worldspan
snookered it into signing a new long-term contract while hiding
objections to Orbitz's business practices, and denied Orbitz access
to certain low cost carriers through Worldspan.
ORBITZ introduced a new perk for customers
who book flight and hotel packages. If flights are delayed and
customers will arrive at their hotels after midnight, Orbitz will
contact travelers and, if given permission, will notify the hotel
that their guest will be arriving late in the hopes of keeping the
reservation. If flights are cancelled, Orbitz will call customers
and, with their permission, rebook clients at a new hotel. Orbitz
for Business and Travelport for Business are working on a similar
program for their corporate clients.
Editor: Dennis Schaal
Phone: (201) 902-1904
opportunities in the E-letters, contact [email protected].