Arguments Against New Distribution Capability of IATA

IATA has filed to the US Department of Transportation for its New Distribution Capability which is said to be the new generation seat distribution facility for the global carriers and on a global scale. The flight booking which you currently do on GDSs or the airline websites can also be done by through the NDC medium. However, there are different perceptions on how the working and evolution will affect the working of the travel agencies who currently use the inventories available of GDSs on a large scale.

Here are some of the points of apprehension regarding the NDC and its effect on agency business. First, it has been said that since the NDC will be a body having all world airline carriers under its umbrella, there are chances of prices of air tickets being decided in non-competitive manner. IATA refutes this claim by stressing that NDC is about distribution aspects of tickets rather than pricing.

Secondly, it is mentioned that operation of NDC will lead to agencies paying up for accessing the inventories. This is different from the current practice wherein there is no additional charge for accessing inventories and agencies only have to pay GDSs when there is a sale of inventory.

Thirdly, there is also an apprehension that it would cost agencies to reassemble all the information from NDC bookings with the one from other non-NDC supplier bookings. Examples of such reservations are of hotels, cruises, cars and tours, all of which are aggregated in the GDS today at no cost to agencies. This will increase the money, time and labor spent on collecting information at one place for MIS purposes.

NDC will be using a system of operation which will enable it to function independent of GDSs despite IATA assurance that its inventory can also be offered via GDSs as well.

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