IATA Chief Calls GDSs ‘Leeches’

The IATA director general had a “Basta!” moment at the airline association’s recent annual meeting, and the targets of his displeasure were the three western GDS companies.

In his State of the Air Transport Industry address, Giovanni Bisignani cited a litany of challenges facing commercial airlines, but he said Amadeus, Sabre and Travelport’s Galileo and Worldspan deserve “a special place” on IATA’s “wall of shame,” largely because of the fees they charge airlines for each GDS booking.

“They are leeches, charging at least $4 per transaction, when China’s TravelSky does it for just $1.20,” Bisignani said.

In addition, he said, the GDS companies sell airlines data about the airlines’ own businesses – intelligence gleaned from MIDT – “with a seven-digit price tag! Basta!”

Bisignani told the airline representatives that IATA would break the monopoly on airline data with “a cost-effective solution.”

He was referring to PaxIS, or Passenger Intelligence Services, a data tool for air travel market analysis that has come under fire from travel agency groups and landed IATA in court with two GDS companies.

A year ago, an International Chamber of Commerce arbitration tribunal ordered IATA to cease using any ticketing information transmitted by Amadeus in its PaxIS product.

The tribunal found that IATA’s use of the data breached its contractual agreements with Amadeus and infringed on Amadeus’ rights under the European Union Database Directive.

A similar dispute with Travelport is ongoing.

Meanwhile, agencies such as Hogg Robinson Group have said that PaxIS goes too far in revealing sensitive data about agents’ booking behavior and corporate air discounts.

IATA’s new annual report says that  “a potential enhancement to PaxIS is under review and development. The Direct Data Service (DDS) will be based upon data sourced from BSPs but supplemented by data directly contributed by the airlines.”