Global distribution system operators Amadeus and Sabre since late 2009 have been busy signing airlines to "full-content" distribution agreements. Most conspicuously by Amadeus in Europe and Sabre in Latin America, the rash of recent announcements means that many managers of multinational corporate travel programs can confidently presume, for at least the next few years, that some of their preferred airlines will continue providing a complete range of fares and inventory in the booking channels used by their travelers.
In Europe, Amadeus since December secured multiyear participation from such major players as Air France (and merger partner KLM Royal Dutch Airlines), British Airways, Iberia and Lufthansa (including Lufthansa Group subsidiary Swiss International Airlines).
Set to take effect in March and run through 2014, the Amadeus deal with Lufthansa and Swiss nullifies airline-imposed surcharges on bookings in Austria, Germany and Switzerland, and therefore eliminates the need for reimbursement by Amadeusto its agency subscribers to offset those charges. Established in 2008 as part of the Lufthansa Preferred Fares Program, the surcharges in Austria and Germany amounted to €4.90 (US$6.84) per segment for "preferred fares" booked in non-direct channels, and in Switzerland amounted to 8 Swiss francs per segment (US$7.58).
Travelport in May 2008 and Sabre in May 2009 reached similar agreements with Lufthansa.
The new Amadeus-British Airways deal--a three-year extension now scheduled to run "up to 2013"--maintains "opt-in" fees for travel agencies in the United Kingdom and Ireland. "The opt-in levels that were established by Amadeus in 2007 remain unchanged," according to an Amadeus spokeswoman. Those opt-in fees--paid to Amadeus by travel agents to avoid BA surcharges--are £0.50 (US$0.80) per segment booked on BA premium-class fares and £1.00 (US$1.60) per segment booked on economy-class fares.
Those essentially are the same levels for participating British and Irish agents who were retained as part of a similar BA-Travelport deal signed in November and also set to run through 2013. Agencies not opting in to the program will incur booking fees of £3 (US$4.79) per booked BA segment.
As a result of the Amadeus and Travelport deals, agencies (and their corporate customers) using the Amadeus, Apollo, Galileo and Worldspan GDSs in points of sale other than the United Kingdom and Ireland will not face surcharges in order to access BA's full content.
BA and Sabre Travel Network in April 2007 announced a three-year, full-content agreement. A Sabre spokeswoman confirmed that deal "goes through the start of the second quarter," but did not provide details on current opt-in levels. She added that Sabre is "currently in discussions" with British Airways. A British Airways official said the airline is "in active discussions" with Sabre on a new agreement.
Meanwhile, Air France and KLM extended the Amadeus full-content deal to December 2013. The Amadeus-Iberia deal was extended to 2014.
GDS Strategies In Vogue In Latin America
For Sabre, Latin American developments--especially in Brazil--clearly indicate a shift toward airlines embracing GDS distribution, which enables travel agencies and corporate self-booking tools to provide access to those carriers' prices and products. Previously, leading Brazilian carriers Gol and Tam shied away from comprehensive GDS participation, which oftentimes required corporations to book directly with the carriers or rely on their agencies to do so.
As Amadeus was taking care of business in Europe, Sabre was reinforcing its presence in Latin America. In Brazil, the GDS operator in January announced a "long-term" full-content distribution deal with Tam. A Sabre spokeswoman said the Tam deal extends an existing agreement that "was not considered full content as the airline did not provide full content to Brazil point of sale."
According to a statement from Tam vice president of commercial and planning Paulo Castello Branco, the airline's full content will be available to travel agencies and corporations at Brazilian points of sale "early in the second quarter. Sabre subscribers in Brazil will have access to the exact same Tam content and services as all other GDSs and even Tam's own travel agency portal e-Tam."
To access all of Tam's content, travel agencies will be required to participate in Sabre's Brazil Efficiency Program. According to the Sabre spokeswoman, "There are no additional fees for travel agencies that don’t opt in to the program. However, opting in to the program is a prerequisite for accessing the additional Tam content. Participation in Sabre's Brazil Efficiency Program provides efficient access to Tam full content through the agent's preferred workflow."
Sabre in August expanded its distribution arrangement with Brazil's Gol from a regional to a global scope, and Gol upgraded its Sabre connectivity level to provide agents "real-time access" to the carrier's inventory system. According to ARC, Sabre and, effective 2 February, Amadeus are accommodating Gol electronic ticketing, "with other GDSs to follow soon."
These developments should help make corporate travel programs--and the travel management companies that support them--more efficient. "The lack of access to airline content through a centralized system has stunted corporate online booking tool growth in Brazil , which has settled at around 10 percent," according to a January blog post by PhoCusWright analyst Patricia Rasore. "Corporations are reluctant to adopt an online booking tool due to the lack of content or local constraints."
Rasore cited June 2009 data from Carlson Wagonlit Travel showing that GDSs in Brazil accounted for 37 percent of air sales and 9 percent of air transactions, in stark contrast to Argentina, Chile, Colombia, Mexico and Peru, where GDSs accounted for the vast majority of air bookings and sales.
Elsewhere in Latin America, Sabre last month announced an extended full-content distribution deal with Lan Airlines, which also selected Sabre to provide reservations and operational systems. A few weeks later, Sabre announced a multiyear, full-content deal with Colombia's Avianca. "Working with Sabre will contribute to optimizing our sales and enhance access to the corporate market, a crucial customer segment given the higher yields from corporate travelers," according to an Avianca statement.
New Deals In Other Regions
Recent airline-GDS distribution deals in other regions include new, separate, multiyear, full-content agreements between U.S.-based JetBlue Airways and both Amadeus and Travelport. In both cases, GDS subscribers will benefit from JetBlue booking and shopping functionality not previously available to them, including electronic ticketing and interactive, real-time inventory.
In the Middle East, Travelport inked new pacts with Bahrain's Gulf Air and Kuwait's Jazeera Airways. Announced in January, the Gulf Air full-content agreement allows the carrier to "offer our products and services to the global travel agency community at the best possible cost," according to a statement attributed to Gulf Air distribution and e-commerce director Lars Denlew.
Announced in December, the Jazeera Airways deal marks "the first time that the airline has distributed its content through the GDS channel," according to Travelport. "The fast-growing regional carrier has plans for a secondary hub and aims to fly 82 routes in the Middle East within the next five years."