Jim Davidson, president and CEO of Farelogix, promises an ongoing analysis in his online blog on the recently settled American Airlines vs Sabre case. In his first blog entry "Asking the Tough Questions" he says the case offers a lot to think about and expresses dismay and shock at many of the revelations now being made public. Sabre and AA settled the dispute late in October after raising controversial issues impacting GDS's, airlines and agents.
Davidson, a champion of direct connect technology, probes the effects of the revelations of the case on the industry and the traveling public and urges industry leaders to read the transcript of the AA v. Sabre case. "In fact, as an interested party, I have taken to reading some of the now public transcripts from the case, and I tell you, the information revealed is pretty shocking. Not just for AA or Sabre, but for our industry as a whole."
In Davidson's words:
"As has been widely reported, American’s opening argument alleges a Sabre-organized and unlawful boycott of AA flights by major TMCs, and the uncovering of a secret Sabre initiative called Project 99. American notes right up front that it had hard evidence, obtained through the discovery process, (primarily emails and documents from Sabre executives and other employees) to show that Project 99 was designed 'to target getting as many things as possible in place to neutralize AA market moves to disrupt the model.' (For clarification purposes, let me say that the 'model' that is being addressed here is the 'GDS model')."
"Later, in sworn testimony, a Sabre employee explains in detail about how Sabre negatively biased AA flights—not just once, but through a series of iterations with each designed to ratchet-up its negative results. A series of emails and other Sabre documents show this was part of a larger plan designed to harm American Airlines," Davidson says.
"I don’t know that it is a stretch for me to assume that any harm to American would, by extension, harm consumers, business travelers, and even travel agencies, but I leave that question for you readers to ponder as we delve further into the evidence presented at court. "
"What was the reason that allegedly drove Sabre to harm its 'biggest and oldest' customer? Bluntly, it was to punish American Airlines for its effort to deploy their Direct Connect. As noted in American’s opening statement, '…this is a story about how a very powerful company in a very secret way spent years – the top executives spent years planning how to crush new competition and how to preserve their monopoly.'”
"What does all of this mean? Some might argue that this is now all behind us now. No doubt some folks want to sweep Case #067-249214-10 under the rug and go back to business as usual. But just take one read of the court transcripts and it becomes obvious why that can’t happen: the AA v. Sabre settlement raises far more questions than it settles, and the boundaries of industry influence and impact reach well beyond a contract negotiation between two parties," Davidson says in his analysis.
"Indeed, the effects of airline display biasing, alleged boycotts involving TMCs (whether through voluntarily or coerced compliance), and the secret Project 99 initiatives have had a ripple effect that we are only now starting to see and hear about," he notes.
"As more information from the case comes out, speculative discussions are turning into real-life questions with real-life ramifications. It’s hard to imagine that senior executives throughout the industry are not having some potentially awkward discussions both internally and externally as questions are asked regarding any potential impact resulting from activities associated with Project 99."
"In an industry that is clamoring for 'transparency,' secret activities that have the ability to drastically alter the information that agencies provide to consumers, thereby impacting the purchase choices of passengers (and corporations) without their knowledge, should not only trigger sensitive discussions between agencies and their customers, but should immediately raise regulatory and other governmental concerns," Davidson says.
Among the questions Davidson asks are: "Did consumers pay more and have less choice due to Sabre biasing and the alleged boycott? Were agencies informed this was happening, and did they actively participate? What is the cost to the consumer? What was the impact to corporate travel programs?"
"Sabre and American Airlines may have settled their differences, but this is not the first time dubious activities have occurred in our industry, and we have no way of knowing if they will happen again, or even if they are still happening now but to someone else. There is much to be learned from information on the inner workings of our industry—information that rarely becomes public and has only come to light as a result of an arduous public battle."
Davidson said that in the coming weeks, in addition to Farelogix' regular Ask the Question posts, the company will be publishing more information about Sabre and Case #067-249214-10.
"This series will rely heavily on court documents. No rhetoric, no heated panel-type debates; this is a 'just the facts ma’am' initiative, the goal of which is to share some of the more salient, high-impact points of the case and ask the obvious questions. One could say that Case #067-249214-10 has opened the proverbial Pandora’s Box: performing an action that may seem small or innocuous, but that turns out to have severe and far-reaching consequences."
"It behooves all of us – across the industry – to understand the facts, the consequences, and ask the tough questions," Davidson concluded, inviting reader comments.
Visit www.farelogix.com