Guest Comment: Concorde or discord?

By Graham Nichols, vice president, Worldspan EMEAA

The passing of Concorde into aviation history prompts my thought that there is little concord in the travel industry at the moment. Discord, rather than concord, appears to dominate an industry that is in a state of extraordinary flux. Aggressive infighting about cost and perceived value is diverting time, energy and attention.

Airlines are slashing commissions, and selling more tickets direct from their own branded Web sites. Other suppliers are looking hard at direct connect. Low cost airlines have overturned traditional cost models. Online consumer travel sites continue to grow rapidly. Legislation threatens VAT on package holiday sales and the EU provoked a storm when it called for higher compensation levels for stranded fliers.

A recent survey revealed that traditional agents see direct Web sales as their biggest threat, closely followed by axed commissions. Agencies and suppliers are considering their GDS relationships as arguments over GDS fees, incentive payments and where the money should go become more rancorous.

Surely the industry is in danger of tearing itself apart. Piecemeal decisions are being taken that benefit isolated parts of the chain in the short term – but provoke angry responses from wider communities because they’re damaged by those decisions.

Is there any hope of a long-term strategic view of what’s best for the industry as a whole? US and EU regulators will soon rule on GDS regulations, some of which date back over 20 years. There are competing views: total deregulation, partial deregulation and maintaining the status quo. Industry analyst Forrester states deregulation is desperately needed. An American consumer advocacy group argues that deregulation ‘will bring more competition and innovation.’ Talk to agents, though, and aspects of deregulation really worry them.

There are problems throughout the travel distribution chain and they’re not exclusively to do with the GDSs despite what you may read. We need to fix the faults together for common benefit – supplier, agent, GDS and traveller alike.

Change is inevitable – but do we want to have change imposed on us? Or should we, as an industry, be making proactive changes for mutual benefit? Some consensus about the way forward is important, or there will be more casualties. And consensus invariably means compromise.

For my business, change has already begun. Worldspan is much more than a GDS. The travel industry wants and needs technology that enables everyone to do their job better, faster and more cost-effectively. So we focus on two things – improving our traditional GDS service (because it’s important and can’t be replaced easily or cheaply), and developing the technology solutions demanded today. Suppliers and agents want improved productivity and efficiency. They want faster, smarter processes and they want to lower costs and raise value.

Worldspan is well advanced in delivering the desired new values – investing in technology innovation, structuring new ways of doing business, listening to customers. But we cannot do it alone – nor should we. Discord must, sooner or later, give way to concord. The industry could make it sooner through debate, dialogue, consensus and compromise. The unappealing alternative is to continue attacking each other. Concord or discord? It’s up to all of us to decide.