ATLANTA — Travelport CEO Gordon Wilson said the company made mistakes in rolling out the Agility suite last month, but that the current incentive model between GDSs and travel agents needs to change.
Subscribers to Travelport’s GDSs — Apollo, Galileo and Worldspan — learned last month that as of Jan. 1 they would be paying a monthly fee for the Agility program, which would bundle new programs with existing ones.
Travelport ended up waiving fees for many agencies under contract (but not unilaterally, says Travelport) after agency groups objected that Travelport was charging for services essential to the functionality of a GDS, a possible violation of GDS contracts.
In an interview during meetings in Atlanta, home to Travelport’s U.S. headquarters, Wilson admitted that Travelport made mistakes with the North America rollout of Agility.
“Where in retrospect we could have done better is the way we went about it,” Wilson said. “We caused the dialogue to be about existing product and bundling packages together at the expense of focusing on our new products and services and the benefits they have to agencies in terms of improving productivity and reducing their costs, which we think we should be recompensed for. It’s the chicken and the egg thing — it has to deliver for people to see that.”
Wilson said the Agility model, in which travel agents recognize the value of GDS products and are willing to pay for them, is good for the industry.
“At the end of day, the wholesale margin transfer from the GDS to the travel agency isn’t a healthy dynamic,” said Wilson. “If it continues, it will mean the GDSs won’t be able to invest in the products that the travel agents want. And there isn’t a huge queue of people investing in those kinds of products for the agencies.”
Wilson said that Travelport needs to do a better job of explaining its value to agencies.
“If it’s a question of, this guy will give me 10 cents more per segment than you will give me, then we’re not doing a good job enunciating our value proposition,” Wilson said. “That’s a sure-fire way to drive the industry to the bottom, which is not in the long-term interest of anybody in the chain.”
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