Global distribution service provider Amadeus, majority owned by Air France, Iberia and Lufthansa, has teamed up with IBM in a partnership designed to offer airlines a package covering all their IT needs.
The partners hope that by combining the Amadeus expertise in inventory, sales and distribution and passenger service systems with IBMÕs outsourcing, integration and consulting background, they can offer a more attractive solution.
The deal allows airlines to choose the prime contractor for IT projects. Hans Jorgensen, vice-president of the Amadeus Airline Business Group, says the two partners will offer each other's services when bidding for contracts, although it will be up to airlines to decide whether they want the combined package.
Jorgensen says that airlines are increasingly treating their IT needs as a commodity. With the costs involved in adapting to changes such as Internet applications, alliance platforms and the replacement or modernisation of legacy systems, carriers are looking to outsource their IT needs. 'It is no longer a strategic issue. It is a question of getting the best price. It is treated as a cost,' he says.
Against this background, Jorgensen says that carriers are looking to providers to cover all their IT needs, rather than the 60-70% that Amadeus can offer. 'They want a full solution, rather than two individual providers.' Jorgensen believes the link with IBM will boost Amadeus in North American and Asia-Pacific markets, where its presence is less developed than in Europe. The deal comes on the back of Finnair's successful partnership with Amadeus and IBM. The oneworld carrier outsourced its IT and e-business requirements to IBM last year on a 10-year basis, and is moving its inventory management and departure control over to Amadeus.These two contracts were signed independently, but set a precedent. 'This is the first proof of the concept,' says Jorgensen. Amadeus and IBM are also in the bidding for SAS Data Services, the IT arm of the Scandinavian carrier. If successful, this will effectively replicate the partnership at Finnair. Elsewhere, Qantas, which is a large Amadeus customer, is in negotiations with IBM on a possible outsourcing deal.
Source: Airline Business
