<B> Sabre Reorganizes Co.</B>
By Mary Ann McNulty
<I>Fort Worth, Texas</I> - If it's going to be nimble enough to capture the information technology outsourcing business of airlines, airline alliances, travel agencies and maybe even corporations, it had to quit operating as a group and become one sales, marketing and product development team.
With that thinking, The Sabre Group late last month dropped the "Group" from its name and reorganized along its two main business functions: information technology solutions and electronic travel distribution. The company now is known simply as Sabre Inc., and division names like Sabre Travel Information Network and Sabre Technology Solutions are history.
STIN president Eric Speck now is Sabre's executive vice president for marketing and sales, responsible for about 4,500 of the company's 11,500 employees and contractors. Bradford Boston, former executive vice president of STS, is executive vice president for product development and delivery, responsible for the remaining 7,000 employees. No layoffs are expected as a result of the changes.
Sabre's highly successful consumer Web booking engine, Travelocity, remains a separate business unit headed by Terry Jones. That news, coming on the heals of Priceline.com's lucrative entreé as a public company, has some speculating that AMR might be interested in spinning off Travelocity, or even all of Sabre, to take advantage of the Internet stock frenzy. A Sabre spokesperson told BTN last week that both possibilities have been discussed for years, but a decision to spin off Sabre must come from AMR. She declined comment on plans for Travelocity.
The reorg also affected Business Travel Solutions in that Nancy Raynor, Sabre's senior vice president of product marketing, now will head the corporate booking product and other emerging businesses, while BTS general manager Sam Gilliland will head consolidated worldwide product sales and marketing.
Speck emphasized that the demand for end-to-end solutions rather than separate applications is forcing the company to take advantage of all possible synergies. The change is "meant to unleash the broad portfolio we have and let us sell to the broad market," he said. As an example, he noted that yield management software has traditionally been pitched by the Technology Solutions unit only to airlines. Though travel agencies might well use the system to manage airline and hotel inventory, STS rarely called on any vendors other than airlines. And in addition to providing airlines with revenue accounting systems, Sabre could link them to point-of-sale systems to help the carriers streamline bookings.
Sabre reported 1998 revenues of $2.3 billion, up 29 percent from 1997, and earnings of $232 million, thanks in part to multi-million dollar, multi-year IT outsourcing contracts signed with US Airways, Gulf Air, Aerolineas Argentinas and Pakistan International Airlines in the past two years. Just over 18 percent of the company is publicly traded, with the rest owned by American Airlines parent AMR Corp.
Sabre also unveiled a new logo that uses lower-case letters. Since its inception in 1963, the company has capitalized its name, an acronym for Semi-Automated Business Research Environment.