In the e-business world, airlines are deciding there is strength in numbers. The US-led airlines' super web site, so far known as T2, will go online in September under the name Orbitz. Meanwhile, the International Air Transport Association has been tasked with developing an industry-wide e-commerce portal.
The original Orbitz equity investors are American Airlines, Continental Airlines, Delta Air Lines, Northwest Airlines and United Airlines, with 30 other carriers signing as marketing partners. The airlines are believed to be investing millions of dollars in this privately held venture to supply thousands of "neutral, unbiased" airline schedules and fares.
Orbitz will offer volumes more information instead of just information on five or six airlines, says spokesperson Carol Jouzaitis. "We will be able to slice and dice the data for lowest fares, most convenient times and even airports within a 50-mile [80km] range for departures," says Jouzaitis. "The consumer is guaranteed access to a broad range of information that is neutral and unbiased. We are not cutting any deals."
The US Justice Department is looking at Orbitz at the partner airlines' request to determine if there are any anti-trust violations. "It is something we have done voluntarily," Jouzaitis says. "We said here are the documents. Ask us any questions. We believe our site will increase competition."
Orbitz represents a breakthrough, says Melissa Shore, an analyst at Jupiter Communications, because it brings airlines that were once adversaries together to get a bigger share of the online business. She says online consumer spending for leisure and unmanaged business travel is expected to soar from $6.5 billion in 1999 to $28 million in 2005.
"Customers increasingly want to use the web, and they want to see all the options in one place, no matter which airline is involved," says Mike Gunn, executive vice-president of marketing and planning at American.
ITA Software of Cambridge, Massachusetts, has put the search engine software in place and is working with Orbitz to finish the interface for a booking engine. Orbitz will also offer booking selections for hundreds of hotels, rental car companies, cruise lines and other travel suppliers.
Meanwhile, at the annual meeting of the International Air Transport Association (IATA) in Sydney in early June, airline chief executives passed a resolution mandating that the organisation examine the possibilities of developing a single e-commerce portal for all member airlines. The airlines are concerned that without such a facility, there will be unnecessary and costly duplication of efforts. "Not everything in e-commerce is competitive," says IATA director general Pierre Jeanniot. "Our task is to identify the vanilla ice-cream so that airlines can put their own toppings on."
Source: Airline Business
