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ASTA Sees Trend to Productivity-Based GDS Contracts

May 18, 2010 By: George Dooley

The movement of agencies away from fixed-rate based GDS contracts to “no-minimum” and productivity-based contracts are among the key trends noted in the American Society of Travel Professionals' (ASTA) new 2009 Global Distribution System (GDS) Report. The trend to “no minimum” allows agencies greater flexibility in how and when they use their GDS for booking, ASTA says. The report specifically examines GDS usage, contracts and distribution trends from the agencies' point of view and takes a close look at the reasons agencies use GDS.

“Travel agencies and the systems they rely upon to access data and book travel have had to make significant changes in the way they do business to stay relevant,” said Chris Russo, ASTA president and chair. “Studies such as ASTA’s GDS Report provide both parties critical benchmarking data that can be used to maintain a competitive edge in a demanding market.”

Among the report's findings:

*    Nearly 40 percent of respondents said they have a “no-minimum” pricing plan, up 60 percent since 2005.
*    Of agencies that have minimum-use clauses, 63.7 percent stated that they never fell below their contracted amount. 
*    The majority of respondents (85.7 percent) use only one GDS, with an additional 14.9 percent using a secondary GDS, an increase compared to 2007 and 2008.
*    Although GDS usage has decreased 19 percent since 1999, more than three-quarters of ASTA agencies are very satisfied or satisfied with their provider, with 55.4 percent planning to renew their contract.
*    About a quarter of respondents use a booking software program with their GDS.
*    The majority of respondents either produce less than 2,500 segments or more than 10,001 in 2008.
*    About half of respondents (47.4 percent) have a three year GDS contract. Over time the average length of contracts has decreased. 
*    Most agencies did not receive any incentives for signing their existing GDS contract. 
*    The majority of respondents felt that GDS air content and GDS functionality was the most important factors to consider when selecting a GDS.

The ASTA Research Family is comprised of a representative sample of ASTA member travel agency owners and managers.



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