British Airways, in tandem with American Airlines, embarks on a transformative journey with new distribution capability technology, unifying visions while navigating distinct pathways.
This collaboration underscores the importance of flexible strategies as they progress towards reshaping the airline distribution landscape, striving to overcome initial challenges and embrace future advancements.
Shared Vision, Divergent Strategies
British Airways (BA) and American Airlines are moving forward with their joint effort in developing new distribution capability (NDC) technology, sharing a unified vision but adopting different strategies. Sam Robinson, BA’s head of distribution, revealed that while the airlines are aligned in their overall goals, their approaches to achieving these objectives will differ, emphasising the unique pathways each carrier takes to implement NDC effectively.
American Airlines had previously removed over 40% of its fares from global distribution systems (GDS) and limited full content availability to NDC channels as of last April. Further stressing the shift, starting May, American Airlines plans to cease awarding loyalty points for bookings made through ‘non-preferred’ agencies, namely those not employing NDC. Robinson acknowledged the initial challenges BA faced when NDC was launched in 2015, admitting the lack of necessary tools at the time.
Building Momentum with Industry Collaborations
Despite initial setbacks, Robinson highlighted the progress British Airways has achieved, notably securing agreements with technology providers like Amadeus and Travelport, alongside 20 other partners. This strategic collaboration underscores BA’s commitment to making the required technology effective before going fully live. Robinson stressed the importance of active participation from stakeholders to refine and improve NDC capabilities, urging industry partners to attempt NDC and report any problems.
He stated, “A lot has changed over the last five years. We want to work with you. We can develop [NDC] capability and content.” The emphasis on collaboration aims to address operational challenges and bolster BA’s NDC deployment by integrating feedback from various industry players.
The Industry’s Perspective on NDC’s Future
Amadeus UK and Ireland’s Steven Love expressed optimism, suggesting that NDC could significantly transform the travel purchasing process. He acknowledged the ambitious targets set by IATA, aiming for 30% NDC distribution among top airlines by 2025 and a full transition by 2030.
Love anticipated rapid advancements in the coming years, envisioning a future where NDC reshapes the operational landscape. However, not all industry leaders share this optimism. Key Travel’s CEO, Saad Hammad, criticised NDC as a “half-baked solution,” raising questions about the realistic trajectory and implementation challenges the industry faces.
Understanding the IATA’s Role and Goals
The International Air Transport Association (IATA) has been pivotal in driving the adoption of NDC by establishing this technology standard to distribute fares and ancillary content through modern online APIs. This initiative aims to enhance flexibility, reduce distribution costs, and offer more tailored travel experiences.
By setting targets for member airlines, IATA hopes to encourage a swift transition towards NDC, potentially revolutionising how airlines connect with intermediaries and consumers. This transformation, although promising, does not come without its challenges, as pointed out by various industry leaders who are sceptical about the pace and feasibility of such a widespread change.
NDC’s promise to redefine airline distribution channels hinges on technological advancements and industry-wide acceptance. As airlines and technology partners work towards these goals, achieving seamless integration and broad adoption remains a critical focus.
Navigating Challenges in NDC Implementation
The adoption of NDC has been met with several obstacles, particularly in technology readiness among providers and the reluctance of some agencies to transition away from traditional GDS. Robinson has acknowledged these challenges, but remains optimistic about overcoming them through continued collaboration and technological improvements.
The call for transparency and feedback from partners underscores the need for a collective effort in refining NDC functionalities. By addressing these concerns, BA aims to ensure a smoother transition, minimising disruptions and maximising benefits for all stakeholders involved.
The Importance of Stakeholder Engagement
British Airways places great importance on engaging stakeholders throughout the NDC journey, recognising the critical role they play in shaping its success. Robust communication channels and constructive feedback loops are essential to identify areas of improvement and align technological solutions with industry needs.
Collaboration with partners is not merely beneficial but essential. As NDC continues to evolve, maintaining an active dialogue with stakeholders will be crucial in overcoming barriers and harnessing the full potential of new distribution capabilities.
Industry Outlook and Future Directions
With the airline industry poised on the brink of significant change through NDC, the road ahead requires ongoing adaptation and strategic foresight. Airlines must stay attuned to technological trends and industry shifts to remain competitive and meet evolving consumer demands.
As IATA’s targets draw nearer, the urgency to innovate and integrate seamlessly becomes more pronounced for airlines like British Airways and American Airlines. Embracing these changes will be vital for sustaining growth and ensuring that the airline industry can deliver enhanced value through improved distribution channels.
The airline industry’s shift towards NDC represents a pivotal moment, requiring collaboration and adaptation to achieve set goals.
British Airways and American Airlines demonstrate a commitment to pioneering these changes, paving the way for more effective and efficient distribution mechanisms.
