Increasingly, airlines are aspiring to use advanced data
analytics and artificial intelligence for tasks such as merchandising ancillary
products and tailoring personalized fare offerings. Now, a graduate program
housed at Florida International University (FIU) will ready students to assist
in exactly those tasks.
"The goal of the program is to have a group of students
who are working on research problems," said Steve Luis, director of
technology and business relations at FIU's School of Computing and
Informational Sciences. "They are getting real-world experience and
addressing real-world problems. And that then creates a better technologist who
can impact the industry and do it in a meaningful way."
FIU will run what it is calling the Airline Data Analytics
and Decision Sciences Program in partnership with the Miami-based airline
merchandising technology provider Farelogix. According to Luis and Farelogix
CEO Jim Davidson, it's the first such program in the U.S. Students will
participate in internships at Farelogix. Program administrators are spending
the summer recruiting the first students and developing course material with an
eye toward the commencement of instruction in the fall.
Davidson is candid about why his company is helping to
develop the program.
"Our goal is, frankly, to employ some of these folks so
they will make our software," he said. But he also expects the students
who receive master's and doctoral degrees through the program to take jobs at airlines,
GDSs and with other airline distribution software developers.
The launch of the program comes as airlines are fighting to
catch up to Amazon and others in the retail tech space. In so doing, many
airlines are striving to diversify their ancillary and bundled product
offerings and to make better use of data in the development of such offers.
Airlines are also in the early stages of offering
personalized dynamic prices, which they develop in real time based on the
supply and demand of flights and the buying history of the person doing the
"I would expect graduates of the program to come out
with a very strong understanding of personalized pricing, dynamic pricing and
all the data algorithms that go into that," Luis said.
Participants in the program might also develop their own
algorithms to be used within the industry, he said. For example, the students
could design algorithms that help revenue management systems and pricing
engines react to market trends in real time. They could also develop software
that furthers airlines' efforts to mine data in order to present targeted
offers that satisfy the needs of both the carrier and the consumer.
For example, Davidson said, properly layered data could tell
an airline that a particular lounge tends to be empty on Tuesday mornings.
Well-designed software could see that, then present fare offers for Tuesday
morning flights that include discount lounge access.
"The intent is to raise the bar to give consumers more
choices and to allow the airlines to increase their revenue and profitability,"
Davidson said. "I think those go hand in hand."
Even in its early stages, the use of personal data by
airlines to present dynamic fares and bundled fares has sparked concern from
consumer advocates. In March, Senate minority leader Chuck Schumer (D-N.Y.)
wrote the Federal Trade Commission to express concern that airlines could use
personal data to discriminate on price.
Luis said that ethics are a part of what FIU's computer
science program teaches.
"As an engineer," he said, "you have to be
respectful of the data owner, [who] is the individual, on how you are going to
treat and manage the data."