Alert: AA threatens to pull ticketing permission from Orbitz


This week, Orbitz received a termination notice from American Airlines for permission to sell AA tickets unless the online travel agency agrees to work only with AA’s direct connect system. If Orbitz does not agree to AA’s terms, their ticketing permission will be stopped on December 1st.

This is a tectonic anti-consumer shift in how airlines want to do business, especially an airline like American. It is a strike directly at the major Global Distribution Systems (GDS) and an attempt to strong-arm travel agents into working directly with American’s distribution system rather than through a system that can provide across-airline comparisons.

The major airlines are already withholding their ancillary fee inventory and pricing information from all travel agents — “brick-and-mortar,” corporate and online. Hiding these fees makes it impossible for travel agents to provide full-cost-of-travel information to their clients and leaves consumers in the dark.

Now American Airlines is taking the first step in separating themselves from the global system that allows consumers, both leisure and business, to compare prices across airlines. This move will further separate them from ticketing transparency and result in the fragmentation of the market.

In the interest of maintaining their “brand” AA is attempting to control every phase of their marketing and prevent consumers from easily comparing prices. AA is seeking to avoid comoditization of the airline travel experience by making it more difficult for their passengers to compare prices.

AA should avoid comoditization by creating a unique customer experience that sets their brand aside from the others fighting for the same customers. Southwest has done it. JetBlue has done it.

The Consumer Travel Alliance has come out repeatedly against any anticompetitive and anticonsumer actions by the airlines. The advocacy group has focused closely on airline ticketing transparency. The Consumer Travel Alliance considers this action by American Airlines, if it is successful, as the first step in the death of ticketing transparency as we know it now.

When airlines hold their prices virtually in secret and only deal one-on-one with ticket agents in ways that prevent consumers from comparing prices across airlines, consumers lose.

The stakes are even higher for consumers than a loss of transparency. American Airlines is attempting to shift the distribution costs to the purchasers of their product. They do not want to pay for distribution like every other sales organization in the world does. AA wants to be paid for the privilege of purchasing their products through the channels that they select.

Today it is Orbitz. Later it will be the retail travel agents being forced to pony up for permission to sell AA tickets.

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