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IATA Distribution Policy Splits Agency Groups

October 23, 2012 By: George Dooley Travel Agent

The International Air Transport Association's (IATA) New Distribution Capability (NDC) sparked more controversy as the Association of Retail Travel Agents (ARTA) and ARTA Canada split with the American Society of Travel Agents (ASTA) and the Business Travel Coalition (BTC) over their positions on IATA's new NDC policy.

"In the end, ARTA and ARTA Canada have every confidence that the NDC will embrace travel agents and listen to their input and concerns, " ARTA said in a statement that questioned ASTA's and the BTC's fears that travel agents and their associations would not be fully represented in IATA's implementation of the NDC policy. "It may just not be with ASTA and BTC which had no interest in listening when they had the chance, " ARTA said.

ARTA noted that IATA member airlines adopted a resolution on a Foundation Standard for the New Distribution Capability (NDC), during a meeting at the World Passenger Symposium in Abu Dhabi last week.

"The NDC will create a set of open XML standards to modernize airline retailing by enabling innovation in the way airline products are distributed, and making possible personalized offers to passengers who will have access to all airline products and services regardless of distribution channel," ARTA said.

"IATA requested travel technology companies to submit XML schemas, a way to define the structure, content and, to some extent, the semantics of XML documents. Farelogix (through the Open Axis Group), Open Travel Alliance, and others participated in the submissions," ARTA said.

"Airlines will be able to differentiate and personalize their product and service offerings across all channels while ensuring that passengers will have full visibility of airline fares and services. It will facilitate new entrants into the distribution sector, resulting in increased competition. Historically competition leads to lower prices and increased choices for consumers, "ARTA argued.

ARTA and ARTA Canada are allied members of the Open Axis Group.

"For the better part of three years, ASTA and BTC have decried those technology efforts which IATA now becomes the repository for the keeping the standards and the codes," ARTA said.

"Not once did ASTA nor BTC sit down with proponents at the many available forums, only to lambaste alternative distribution systems which it knew little about," ARTA charged.

"Supplied with the deep pockets of the GDS community, ASTA and BTC continued with a scathing rebuke of novel and cost-saving initiatives to include travel agents as well," ARTA said.

ARTA said that, "Now comes ASTA and BTC wanting a "seat at table" to discuss the NDC, and IATA is on guard for a disruptive climate from staunch naysayers." 

ASTA and the BTC questioned if the NDC was being conducted in the open, involved travel agents viewpoints and if the "transparent collaboration" promised by IATA with all segments of the travel industry was being realized. "Nothing could be further from the truth," the associations said in a joint statement. (See TravelAgentCentral, October 17)

"“ASTA sees nothing in the IATA process to create NDC that resembles full and open transparent collaboration with the travel agency community,”" ASTA said. 

"No one is defending IATA's tactics, but you can certainly see its point, " ARTA countered.

IATA's viewpoint is clear: "Airlines are trying to escape the commoditization trap through differentiation, and merchandizing. They are developing products and services, such as special meals, expedited boarding, roomier seats and access to airport lounges. But the travel agent sees only fare codes—F, J, Y and their various derivatives—which cannot fully describe options available. Customers expect more," Toby Tyler, IATA's director general told the World Passenger Symposium in Abu Dhabi. (See TravelAgentCentral, October 16)

“The solution is the NDC powered by open XML standards. This will enable innovation in the way airline products are distributed. One key outcome will be closing of the gap between airlines and their customers so that customized offers can be made to travelers even through travel agents,” said Tyler.

"IATA’s role is to lead the industry to adopt a new, modern infrastructure that will accommodate more choices for personalized travel offers, provide the foundation for the development of efficient tools for agents and lower the overall cost of distribution," Tyler said.

To this end, IATA will propose a roadmap and business case for the NDC, Tyler said. “We expect to complete the Standards definition next year. Then competition and travelers’ needs will guide airlines, agents, system providers and new entrants with tremendous opportunities for innovation."

"Forty years after the birth of the current distribution paradigm, we have an opportunity for a revolution in airline retailing,” said Tyler.

ARTA is headquartered in Scottsdale, Arizona and is the strategic partner of Canadian-based ARTA Canada.

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About the Author

George Dooley
George Dooley, Travel Agent’s senior contributing editor covering retail and technology, has a long-standing reputation as one of the top travel industry journalists. He notes...

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By George Dooley | October 23, 2012
ARTA splits with ASTA and BTC over IATA's new distribution plans.
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