SYDNEY -- Technology initiatives announced last week by Star
Alliance and SkyTeam could signal a new era for those airline alliances as they
strive to maintain their relevance.
"We know that to be relevant we really need to invest
in technology," outgoing SkyTeam CEO Perry Cantarutti said at the IATA
Annual General Meeting here last week. "That's where we've been focused
for the last couple years and where we will be focused for several years."
The digital efforts underway at Star Alliance and SkyTeam
nearly mirror one another, with both designed to help member airlines make the
seat-booking experience more seamless for passengers traveling on an
itineraries that include an interline connection within the alliance.
For example, with the aid of the Star Alliance Digital
Service Platform, customers can use the United website to choose seats on both
legs of an itinerary from Chicago to Singapore via Shanghai that involves both
United and Singapore Airlines.
SkyTeam has a similar platform in testing and expects that
Delta and Aeromexico will shortly become the first two carriers to make use of
it. Along with seat assignments, the SkyTeam's SkyLink Digital Spine gives
airlines the functionality to offer one-stop shopping for paid baggage checks
on interline itineraries.
A second functionality that the Star Alliance system is
already enabling is real-time baggage tracking on interline trips. United and
Lufthansa are the first two airlines to take advantage of that solution, Star
Alliance CEO Jeffrey Goh said at the IATA conference.
Both alliances said the move into facilitating a simpler
booking experience for interline customers represents a new phase in their now
two-decades-long existence.
Founded to promote partnerships that ease connectivity for
travel to disparate parts of world while remaining immune from antitrust laws,
the three airline alliances (Oneworld is the third) have more or less stopped
growing as the reach of their member airlines has come to cover the globe.
The alliances also have had substantial success in offering
lounge access to frequent flyers of member airlines while also tying together
those airlines' loyalty programs.
But Peter Harbison, CEO of the CAPA Centre for Aviation, an
Australia-based airline research and market analysis company, said alliances
have been losing influence in recent years as carriers have begun relying more
heavily on bilateral codeshare partnerships and joint ventures, sometimes with
airlines that aren't members of their alliance.
For example, he cited the codeshare between Oneworld's
American and SkyTeam's China Southern as well as the joint venture between
Oneworld member Qantas and Emirates, which isn't in an alliance.
Offering IT platforms that make it easier for airlines to
work with alliance partners could slow the pace at which the larger alliances
are fraying.
"If they can't build seamlessness, if they can't build
that out, then you are going to continue this erosion," Harbison said.
Cantarutti and Goh both said that over time they'll increase
the functionalities of their respective platforms. For example, the Star
Alliance would eventually like its Digital Service Platform to smooth the
process for interline loyalty point redemption and make it easier for member
airlines to rebook passengers who have missed connections on a two-airline
itinerary.
Still, it remains to be seen how many of the Star Alliance
and SkyTeam airlines will take advantage of the offerings
With both alliance platforms, the individual carriers must
still reach agreements to work together before making use of the IT offerings.
Cantarutti said seven of SkyTeam's 20 member airlines would be using its system
by the end of the year, while Goh said he expects approximately a third of Star
Alliance's 27 airline members to be enabled this year.
One carrier that is wavering is Star Alliance member LOT
Polish Airlines. In an interview in Sydney last week, Wojciech Jagietto, LOT's
manager of alliances and partnerships, said Star Alliance's new digital
platform is definitely useful, but LOT still has to make strategic decisions on
how to best allocate its resources.