MADRID -- Amadeus agents will have to wait a while longer for
complete access to Web fares within the GDS, as Amadeus, on Nov.
25, unveiled a new pricing strategy that charts a different course
than competitors Sabre, Worldspan and Galileo.
Sabre discounted its booking fees across-the-board to airlines
that provided access to their Web fares, and Worldspan and Galileo
essentially matched that method.
But Amadeus opted for a new approach: Amadeus will vary its
booking fee for airlines according to the market in which the
flight is booked and it will unbundle an itemized list of GDS
services that airlines can optionally use and pay for.
For Web fares and other "low-fare content," the model entails
offering airlines a large booking-fee discount that would apply to
the low-fare content bookings only.
Amadeus officials in North America said they are talking to
various airlines about that option, although none have signed up
for what Amadeus described as "pilot testing" of the program in
2004.
U.S. agents wouldn't lose incentive pay or pay a fee to access
the Web fares -- at least for now -- although Amadeus said it plans
to do that in other countries where agents don't rely as much on
incentive pay.
Amadeus calls its new system "value-based pricing," and here's
how it will work.
In January, Amadeus will begin charging airlines a "standard
value" booking fee for domestic and intra-continental reservations
made within an airline's self-identified home or prime market [U.S.
airlines seem certain to choose the U.S.], and a "premium value"
fee for any other reservations.
For North American carriers, the standard value fee in 2004 will
be 5% lower than Amadeus' 2003 fee; the premium value fee will be
5% higher.
Fees will continue to vary by level of airline participation in
the GDS, but in 2005 the costs will become unbundled even more,
with airlines choosing from a menu of itemized services.
To contact reporter Andrew Compart, send e-mail to [email protected].