From the publisher

Bruce Piper discusses the possible implications of IATA's New Distribution Capability reducing transparency.

From Bruce Piper

Welcome to the October 2018 issue of travelBulletin, which contains our annual round-up of some of the big earners in the Australasian travel industry. The Million Dollar Club feature is very popular each year, and in 2018 we have represented the fat pay packets with a comparison of the number of private jets they can all buy.

It should be noted, however, that the Million Dollar Club only highlights the income of the senior executives who have the first world problem of their packages being exposed due to working at ASX-listed companies. Many of the largest businesses in the industry are privately held, and I would not be surprised at all to find that similar figures are being racked up by their owners too — without the annoying scrutiny that a public annual report brings.

MEANWHILE a recent technology launch by Sabre has rung alarm bells among stakeholders concerned about the propensity for IATA’s New Distribution Capability standard to reduce transparency in flight pricing.

Because NDC has the ability to provide deep customer insight, some have been concerned it may result in prices charged to passengers varying based on such elements as their previous purchasing patterns, carrier loyalty and other personal data.

For example, in the case of a business traveller who generally flies with a particular airline, surely it would be a temptation for the carrier to present a higher price based on the fairly certain assurance the client will buy that fare regardless of the cost — in contrast to a potential new customer that the airline is attempting to woo? NDC would enable this, versus current platforms where fares are the same regardless of who might be purchasing them.

The new Sabre AirVision Fares Optimizer product “generates fare recommendations by estimating each customer’s potential willingness to pay”. It suggests pricing structures based on customer segmentation, and is part of a broader Sabre strategy to build a Digital Commercial Platform that “delivers end-to-end personalised retailing for airlines”.

Some fear a future where flight pricing uses Facebook-like algorithms based on personal details like age, address, employment status, family situation, investments and even gross income to adjust fare offers based on the client’s ability to pay. Current technology already enables some of this to happen, and the rich data provided by NDC will facilitate a further evolution of this possibility.


Subscribe To travelBulletin