Travel Weeklys Technology E-letter: Aug. 10, 2005

SABRE-US AIRWAYS: With most of its airline content agreements expiring in mid-2006, Sabre extended its GDS contract with US Airways for one year. US Airways, which is in bankruptcy court and on track to merge with America West in the fall, was the first signer of a Sabre Direct Connect Availability-3 (DCA-3) contract in October 2002, and it just became the first to renew. The pact, which gives Sabre access to all of US Airways publicly available fares in exchange for booking fee discounts, was extended to October 2006. An extension implies very similar terms and conditions, said Sabre Chairman and CEO Sam Gilliland, adding that he expects other new contracts to come with varying terms and earnings impacts. US Airways would not discuss the contract other than to confirm there still is one. But a source who is familiar with these types of contracts said they automatically renew if the airlines do not reject them. Under the bankruptcy court process, US Airways still could reject the contract before the carriers emergence from Chapter 11. And that could be important because America West doesnt have a DCA-3 or similar contract. Gilliland said Sabre hopes to come to terms with the merged entity.

TRAVELOCITY-YAHOO, EXPEDIA-MSN:Travelocity extended its contract one year, through 2006, as the exclusive air, car and hotel provider to Yahoo Travel. The deal, which had been slated to expire at the end of 2005, had a renewal option for 2006 and another for 2007. Travelocity wouldnt discuss the agreements details. Michelle Peluso, Travelocitys CEO, however, did say: We have built strong down-side protections into the contract extension to preserve the value of our investment in our partnership. The Yahoo-Travelocity relationship has been under pressure since Yahoo bought search-engine FareChase, with Travelocity arguing that FareChases focus on price is not in Travelocitys -- or anyones -- interests. So, as part of the renewal deal, Travelocity declined to participate in the Yahoo/FareChase metasearch effort either under the Travelocity or Yahoo Travel brands, Peluso said.

MEANWHILE, IN LOCKING UP A PORTAL DEAL for itself, Expedia Inc. expanded its agreement with MSN. In contrast to earlier agreements that solely had powering MSNs travel offering, the new agreement also takes in Expedias, Hotwire and TripAdvisor. Expedia said it was not ready to discuss how its sister companies will be displayed on MSN.


BOOK EM, DANNO: Despite earlier statements to the contrary from, Sabre said it expects to process some of the online agencys segments over time, meaning sometime in 2005. Bottom line is we expect bookings from that relationship, said Sabre chairman and CEO Sam Gilliland. We have a very good relationship with [Expedia], Gilliland said. We have a contract with them, and over time we expect the contract will deliver bookings. Expedia, though, declined to comment on Gillilands statements, which came during Sabres second quarter earnings call, other than to say that its relationship with Sabre is dandy. The issue revolves around the two companies five-year agreement, signed in May 2004, which would have Sabre providing GDS functionality to, taking some segments away from Worldspan. The contract has not been implemented, and last month stated that it had decided not to put development resources into connecting the two companies systems. Asked about the prolonged gap between the contract signing and implementation, Gilliland said Expedia needs to put more development resources into the effort and that implementation is in the queue.

BOOKING BUILDER TECHNOLOGIES upgraded its Booking Builder Desktop, a fare search and booking tool that provides access to more than 25 carriers, including Southwest and Jet Blue. Among the tweaks, the new version enables travel agency owners and travel managers to customize airline prompts to highlight preferred vendors, whether they are GDS participants or not. Booking Builder can be integrated with the four GDSs, as well as Trams ClientBase Plus and back-office accounting systems. Booking Builder Technologies claims its Instant Fare Quote product, which is part of the desktop, can retrieve JetBlue fares in 3 to five seconds because BookingBuilder distributes the collection and processing of flights and fares across all computers running the application, instead of focusing all requests to go through a central server.


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