The International Air Transport Association is facing flak from the global travel agency community over its plans to jettison paper tickets by the end of the month. Come 1 June, if IATA succeeds in its four-year effort, airlines around the world will use only electronic documents for nearly every passenger ticket issued through IATA bank settlement plans. The organization has shown no willingness to agree to travel agency requests for a delay. Meanwhile, global distribution systems have developed solutions to ease the transition for agencies.
E-ticket penetration in most regions and via GDSs has surpassed 90 percent, but achieving nearly 100 percent by the end of this month is too challenging, travel agent groups said. They suggested that some transactions do not yet have an electronic equivalent to paper processing (including group travel, ticket reissues and other changes, and certain multi-modal combinations); some airlines and airports have not equipped their systems to accommodate 100 percent e-ticketing; some countries require "proof" of travel as part of visa applications; and, perhaps most prominently, many interline agreements between carriers have not been e-ticket-enabled, which could prevent certain itineraries from being booked and cause confusion when a traveler misses a connection on a multi-carrier itinerary.
IATA's actual global target is 96.5 percent, with the remainder representing paper tickets that "were never really going to be converted," according to comments emailed to The Transnationaland attributed to Bryan Wilson, IATA CIO and e-ticket project director. The discrepancy includes 14 airlines not intending to convert to electronic tickets; some agents and passengers preferring paper; and certain interline agreements "which are rarely used and uneconomic to convert."
Wilson noted that "about 50" airlines will fail to meet the deadline. But because those operators are comparatively very small, they represent a negligible portion of IATA BSP volume.
IATA said airlines will have to train their personnel to accept the paper tickets issued directly by airlines or by the Airlines Reporting Corp. in the United States (where no e-ticket mandate has been established) and reject neutral paper tickets issued on IATA stock. The association also acknowledged other situations where agents cannot issue tickets, and told them they must find alternative solutions. "Each airline needs to find a workaround for these situations or instruct their travel agents how to proceed," according to Wilson. "In some cases, the travel agent will contact the airline and have the airline issue the paper ticket; but, in some cases, the airline will simply lose that booking to another airline." Wilson added that the challenge of visa applications in certain countries has "been resolved."
Requiring agents to piece together "workarounds" does not sit well with many. According to the European Travel Agents' and Tour Operators' Associations (representing associations in 29 countries) and the Guild of European Business Travel Agents, the "main issue" regarding the elimination of neutral paper tickets is interlining. "The foreseen consequences are restrictions to the choice of clients and maybe higher fares if it is necessary to issue separate tickets, as well as inconveniences for passengers concerning baggage through checking," the groups wrote in a document presented to IATA last month.
The Advantage Travel Centres consortia in the United Kingdom--representing more than 200 travel management companies--shared similar concerns and asked IATA to delay the deadline by six months. "Airlines that currently have paper ticket interlining are dropping these deals all over the place because, come 31 May, they don't know how they will pay each other," said Advantage director of business travel Norman Gage. "For agents, it is going to be a nightmare. GDSs might show a fare that isn't possible to book. And, in many cases, agents will be forced to buy separate tickets instead of one, and that will mean having to tell clients the price is much more than originally thought."
As a result, the IATA move would "stretch relationships between business travel agents and their clients to a breaking point," according to Advantage.
IATA said that by March 2008, 3,400 of roughly 12,000 interline agreements had been converted to accommodate electronic ticket processing. "These agreements covered 90 percent of March interline traffic," according to IATA's Wilson.
But interlining isn't the only issue. An ECTAA survey conducted in February and March found that among 432 travel agency respondents from Australia, Canada, Europe, India and South Africa, paper tickets overall "still represent an average of 10 percent of travel agents' air transport activities."
By comparison, Travelport's three GDSs--Apollo, Galileo and Worldspan--have a global e-ticket penetration of 95 percent, according to a Travelport spokesperson, who added that paper tickets during the past three weeks were reduced "by 13 percent." Sabre Travel Network said agents connected to its system issue 93 percent of tickets electronically. At Amadeus, the figure is 91 percent. IATA said global e-ticket penetration by the end of March had reached 94 percent.
Electronic Ticket Penetration by Region | | April
2006 | April
2007 | March
2008 | | Middle East/North Africa | 11% | 43% | 88% | | North Asia | 32% | 91% | 97% | | Asia Pacific | 37% | 69% | 92% | | Africa | 36% | 60% | 87% | | Europe | 66% | 83% | 95% | | Americas (except USA) | 64% | 83% | 94% | | United States | 87% | 93% | 97% | | Russia (CIS) | 1% | 16% | 64% | | TOTAL | 48% | 80% | 94% |
Source: International Air Transport Association |
ECTAA and GEBTA also pointed to "an unlevel playing field with airlines, which will always have the possibility to issue their own paper tickets."
In Canada, similar travel agency concerns prompted the Association of Canadian Travel Agencies to file a complaint with Canadian competition authorities. ACTA and the Canadian Standard Travel Agent Registry, along with other groups, also circulated a petition opposing the elimination of paper documents "prior to the implementation of an electronic ticket solution for each transaction type where an electronic ticket is not issuable today ... premature removal of paper ticket stock from BSP-participating travel agencies will create complete chaos and disruption in the travel agency distribution channel."
At press time, more than 1,400 signatories were listed on the petition.
IATA's Wilson noted that the organization has been in contact with Canadian authorities. "We do not envisage any legal impediments to achieving our move to 100 percent e-ticketing on schedule," he wrote. "The deadline is firm."
But Advantage's Gage told The Transnationalthat airlines "were being driven into [electronic] documents faster than they could get their house into order." He suggested that IATA's electronic miscellaneous document, designed as "the ultimate in a versatile document," would not be ready until next year, forcing global distribution system operators in the interim "to invent a workaround" for agencies issuing tickets outside the United States.
Travelport customers, for example, "can create a Virtual Multi-Purpose Document (VMPD) via the BSPLink product currently utilized by many travel agencies around the world," according to company information.
Similarly, Amadeus and Sabre Travel Network each plan to make available next month a "Virtual Miscellaneous Charge Order" solution for travel agency subscribers. According to an Amadeus spokesperson, the company's VMCO "is based on the current Amadeus automated MCO product but without the need for coupon printing ... there are no changes to the way documents are reported and integration to the back office will remain the same. The product will also allow the passenger receipt to be emailed to the customer."
According to Sabre, agents using VMCOs can arrange for passengers to pick up paper tickets at the airport for transactions and itineraries that have no e-tickets available. Sabre said its new solution "will be completely automated, passing transaction details to IATA's BSPs and an agency's mid- and back-office systems for a fully integrated, end-to-end solution."
Each of the three GDS operators also has developed solutions to facilitate interline e-ticket agreements. Travelport, for example, said its GDSs support nearly 6,300 such links. Sabre Travel Network claims 6,100. Amadeus claims 1,400, while furnishing e-ticket capabilities for 268 individual carriers.
According to IATA's Wilson, GDS companies "are doing their best to support" the move to complete e-ticketing. "Most of them," he said, "have committed to removing paper ticket issuance for IATA BSP travel agents on 1 June."
IATA has formulated a detailed plan to retrieve, check and then destroy remaining paper ticket stock. It said that sales using neutral paper tickets after 1 June "will not be recorded."
Despite complaints from some agencies, IATA's push for e-ticketing ubiquity has generated new efficiencies for the industry and for travelers. The association pegged total annual cost savings at $3 billion, as e-tickets cost about $1 to process versus the $10 cost for paper tickets. For travelers, e-tickets make moot the concerns about lost tickets, make possible widespread use of online check in and self-service airport kiosks and facilitate mobile phone transactions.
Related Resource:
Association of Canadian Travel Agencies and the Canadian Standard Travel Agent Registry petition against IATA's elimination of e-tickets