International Airlines Group (IAG) carriers British Airways and Iberia will implement a $10-per-one-way surcharge on bookings through a GDS beginning Nov. 1. With the move, the carriers become the second and third airlines to assess a GDS surcharge, joining Lufthansa, which implemented an $18 flat fee in September 2015. Travel Weekly senior editor Robert Silk spoke with ASTA senior vice president of marketing and industry affairs Mark Meader about what the surcharge could mean for travel agents.
Q: Why does the concept of a GDS surcharge continue to concern ASTA?
Mark Meader
A: I think really it's the complexity that's added for our members. What will occur when carriers start to require that agents begin shopping or booking either through [the carrier's] own website or portal? The degree of complexity when agents have to jump between airline websites or portals is potentially very arduous.
Q: Do you believe the British Airways/Iberia announcements will have a ripple effect?
A: I can't speak to what other carriers do or don't do. I think they all look at this differently. But again, it does boil down to the complexity issue for us when each carrier begins to process its own solution. It only disservices the traveler.
Q: What will the impact be on the standard agency business model?
A: It becomes an efficiency issue. Because what the end consumer expects is for the agent to be able to shop for them and compare prices and availability. It makes it more arduous to do that effectively.
Q: IAG said it plans to open a trade portal for agents to work through on bookings using IATA's New Distribution Capability (NDC). Why is that not as good as the current GDS model?
A: It is certainly helpful. I think NDC in and of itself is certainly a good thing. It [enables] shopping comparisons. It [enables] airlines to display products on the store shelves the way any retailer would like to do. It's the way that the store shelves are available for the agents to shop that is the issue here.
Q: Could the IAG portal offer better displays of ancillary products than the GDSs currently do?
A: It's potentially a better display with more detail and more information, but it is based on the individual carrier.
Q: Amadeus said it is working within the context of NDC to develop a solution that can be widely adopted by both travel agencies and airlines to deliver sustainable results at a scale that matters. Is that where this ends up?
A: I think all the technology players, including the GDSs, need to expeditiously innovate and populate the store shelves so that agents will be able to shop any and all products with efficiency.
Q: Can that work for airlines? They'd still be saddled with booking fees.
A: I'm sure that it can be done cost effectively in a way that satisfies everyone's need.
Q: Isn't this just the wave of the future, more use of NDC technology? How does the agent community work with carriers and the GDSs so that all parties are happy?
A: I think that what you'll see in the future, the GDSs will be there next using NDC as a solution in a cost-effective way much like any other technology players. And I expect that will be their goal.