travel managers' association VDR is gunning for modifications to corporate data
requirements in agreements with more airlines following its successful effort
to force changes to Lufthansa's domestic contracts.
cartel authority, the Bundeskartellamt, announced on December 20 that Lufthansa no longer will require clients to submit to its AirPlus International subsidiary
card payment details with all airlines. The authority launched the probe in
April 2011 following complaints from corporate clients and the travel office of
the German federal government that were coordinated by VDR.
the Bundeskartellamt labelling the relevant contractual clauses "anticompetitive,"
VDR believes a precedent has been set to prevent airlines from offering deals only
to customers that agree to forward all their air data. "The implications
go beyond Lufthansa's domestic contracts," said Jörg Martin, owner of CTC
Corporate Consulting and head of VDR's airline committee. "This is a step
in a new direction. Lots of contracts require data."
executive director Hans-Ingo Biehl shared a similar sentiment. "Our views
have been vindicated," he said. "It is vital that we follow this up
for other contracts. We want to be clear where our data is going. We would
encourage other associations in Europe to look at this and we could take it up
through GBTA Europe." VDR also is considering whether to bring the matter
to the attention of the European Commission.
added that VDR's concerns include contracts managed by third-party data
intermediary Prism, a subsidiary of U.S.-based Sabre. Numerous airlines,
including Lufthansa for its global contracts, require clients to authorize
submission of their data to Prism as a means to establish marketshare
requirements and verify performance. Although Prism always has claimed to take
many precautions to mask client data and only takes from travel agents data feeds
with the explicit approval of the client, some travel managers have said they remain
unhappy with the arrangement. They argue that they have little alternative to "volunteering"
their data to Prism because it is almost impossible to obtain a reasonable
contract from airlines without doing so.
vice president for Europe, the Middle East and Africa Herman Mensink said there
are crucial differences between Lufthansa domestic contracts and those which
use data managed by Prism. The first is that Lufthansa required clients to
submit data to one of its own subsidiaries, whereas Prism is an external data
manager. The second is that Lufthansa's domestic contracts are based on volume
targets, whereas Prism handles data for market share-based contracts.
you want to do a deal based on market share, there is no way you can achieve
that without measuring the client's data with other airlines," said
Mensink. "The Prism approach is that it is a neutrally managed contract
based on market share. The Lufthansa approach was that you couldn't get the
contract without providing the data to the Lufthansa Group. With Prism, it's an
opt-in. We are an outsourced IT department for airlines to manage the contract."
the accusation that clients have no realistic alternative to submitting data to
Prism, Mensink said: "That's an airline issue, not a Prism issue. I can
understand why VDR wants to look into this but it doesn't boil down to a data
issue. It's a dealing issue. Do you want your contract to be measured or don't
you? VDR seems to want deals based on market share without providing the data
or both parties being able to manage the contracts professionally."
Lufthansa spokesperson told Business Travel News that "no changes are
planned" for its requirement to feed data to Prism for global agreements.
The company also said that while it is complying with the ruling of the
Bundeskartellamt, it had not engaged in anticompetitive behavior because it prevented
its passenger airline from seeing competitor information. Lufthansa claimed
that was accomplished via a filtering system through which AirPlus processed
the data before forwarding it to Lufthansa Revenue Services, part of the Lufthansa
Systems airline technology business, and that the only intention was to gather
enhanced data about clients' purchases with Lufthansa Group carriers.
2013 we will abandon any delivery of complete airline data by customers,"
the spokesperson said. "Before, we did the filtering. Now our customers
will do the filtering and send it to us, which was the wish of most of them.
However, in the whole text from the Bundeskartellamt, you won't find a single
sentence which says we misused the data. We were always convinced that our
Chinese walls worked fine."
to a statement from Bundeskartellamt president Andreas Mundt, "The clauses
gave Lufthansa access to competitively sensitive information of rival
companies. In order to qualify for certain discounts or sales refunds, major
customers of Lufthansa had to provide such data. This included not only
information about flights booked with companies belonging to the Lufthansa Group
and its cooperation partners but in particular also sales data for flight
bookings with its competitors."
Lufthansa spokesperson said the airline will continue to offer back-end rebates
in spite of the ruling, although most domestic agreements with its 800 or so clients
are based on upfront discounts.