WASHINGTON -- Show me the data.
So say many U.S. and foreign airlines that are blasting the
Transportation Department's plan, as part of its rewrite of the GDS
rules, to restrict airline access to GDS marketing information data
tapes, or MIDT.
The data typically show how many bookings are made by each
agency on each airline in individual markets, the fare basis used
for each booking and the flight booked by each passenger.
Many agents and agency groups have complained for years that the
airlines shouldn't be able to buy the data, and now that the DOT
seems to agree, a major battle is shaping up over the issue.
In their comments to the DOT about the GDS rule changes, many
agencies supported the DOT's plan to ban GDSs from releasing data
on bookings made by individual agencies or on bookings for airlines
that have not consented to the release of that data.
Carlson Wagonlit Travel, for example, said it shares the
department's concern that airlines can use the data to thwart
competition.
"In essence, the airline can structure incentives to prevent
travel agents from using a rival airline, rather than have to use
incentives to attempt to attract the subscribers' business,"
Carlson Wagonlit said. "Similarly, when the dominant airline can
identify the specific corporate customers, the airline can develop
tactics to deter those customers from using a rival airline."
ASTA, however, disagreed with the DOT's assertion that a benefit
of the restrictions would be to curtail the use of override
commissions.
ASTA said there's no evidence that overrides result in consumer
harm, and it wants the DOT to modify the proposal so that agents,
like airlines, would be able to consent to the release of their
data.
Such a change won't mollify objecting airlines, which argue the
data is critical for deciding where to launch new routes and how to
market them.
American said, "Airlines are losing billions of dollars and are
urgently seeking to identify the right size for their networks, a
profitable combination of routes and the most effective marketing
strategies.
"The department's proposal to intentionally degrade the quality
of information in the marketplace would result in poorer
decision-making and greater losses."
Many foreign carriers of all sizes also objected, including
LanChile, TACA and the Association of Pacific Carriers.
Virgin Atlantic said the restrictions would "reduce airlines'
ability to offer legitimate rewards to travel agents and
corporations."
Several U.S. airlines echoed that view, including
Continental.
"Without the individual agency data, agency commissions would
likely decrease and airlines would not be able to determine where
and how to target marketing activities to agencies," Continental
said.
Some U.S. airlines, including America West and Midwest, favored
the restrictions because they feel the big airlines use the data
against them.
As for the GDS operators, which earn some revenue from selling
the data, the consensus is to keep the status quo.
Worldspan, which would like to see an end to all GDS rules, said
that while large airlines might use the information to beat up on
smaller carriers, "They also use the information to compete more
effectively against each other and to offer better service to the
public."
Sabre said there's no basis for the DOT to try to regulate the
prices that the GDSs charge for the data.
The National Business Travel Association also weighed in on the
issue, arguing strongly for the privacy rights of corporations
regarding their travel buying habits.