ASTA and the Interactive Travel Services Association (ITSA) questioned the impact of antitrust immunity on both travel agents and consumers in response to the oneworld Alliance’s (American Airlines, British Airways, Finnair, Iberia Airlines, Royal Jordanian Airlines) application for anti-trust immunity (ATI) to Department of Transportation (DOT).
In its comments, the two groups requested that “given [the] risk of significant competitive harm, any grant of immunity to the oneworld applicants should be limited to protect competition” and “that the Department carve out from any ATI grant any form of cooperation by the Joint Applicants in their dealings with independent travel distributors.”
ASTA and ITSA said that any granting of ATI that extends to dealings with travel distributors such as travel agents is likely to cause consumers significant harm “first, by ultimately reducing travel distributors’ bargaining power and marginalizing independent distribution through commission reductions and withholding inventory, and second by increasing fares paid by consumers as the number and effectiveness of independent travel distributors are reduced and consumers’ ability to find and compare competing airline service offerings becomes increasingly limited.”
The comments noted that whereas consumers and travel agents want lower fares and increased service, ATI and alliance status are not “factors in consumer choice — lower fares and more frequencies on nonstop flights matter the most.” Nor is ATI necessary to provide efficient coordination between carriers, the two groups explain. In fact, “the Joint Applicants utterly fail to show how efficiency requires immunized joint dealing with travel agents ... the Joint Applicants do not make it clear that immunizing joint dealing with travel agents would benefit anyone other than the Joint Applicants.”
Consumers, as already noted, will also come out on the losing end should this ATI be granted for a variety of reasons, not the least which being that any resulting reduction in the “number and effectiveness of travel agents would also increase fare for consumers by reducing their ability to find and compare competing airlines service offerings.”
ITSA is the trade association for online travel companies and global distributions systems, and is their voice on matters of public policy.