Online distributors undercut GDSs by 50%
Online distributors are undercutting GDS fees by more than 50%, a report on deregulation has confirmed.
The Association of Corporate Travel Executives spelled out the position as it published its July status update into GDS deregulation in Europe.
It described current European Community non-discrimination requirements as “particularly burdensome” in the age of the internet.
“The EC Code’s non-discrimination requirement stifles price competition because if CRS vendors provide a discount to one airline, they must provide it to all,” the report says.
The ACTE said the rule has become burdensome in the age of the internet where lower cost, online distributors – which are not subject to the same code of conduct as GDSs – can undercut GDS fees by upwards of 50%.
The report says cash-strapped carriers see the online rivals as the key to relieving their financial woes and have already begun to swap inventory from the GDSs to the new web-based channels.
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