08 Nov NDC Grows, But There Are Big Hurdles To Overcome
Written by Marisa Garcia – Flightchic.com
IATA’s New Distribution Capability (NDC) program is advancing, with 21 airlines on the leaderboard committed to processing 20% of their bookings volume through NDC by 2020. The opportunity to improve the way in which products are presented and to better sell ancillaries is inspiring airlines to experiment. As adoption grows, the significance of this new distribution standard becomes more apparent.
“I’ve been in the industry almost 30 years and I’ve never lived thorough anything that has the ability to transform the industry quite the way that NDC does,” Kathy Morgan of Sabre says. “It’s become such a broader topic around airline retailing and the fact that airlines themselves have transformed so much in how they are thinking about product.”
New ways to manage data
But with this progress, come new questions on how to manage the data beyond booking.
“We also think about beyond NDC as that end-to-end view,” says Kathy Morgan, Vice President and Head of NDC at Sabre. “I don’t want to do a one-off proof of concept that shows that, yes, you can get it off an order book but everything else doesn’t work.
We want to bring it live at scale and the way you do it is through close engagements with all of your constituents—all of them, airlines, agencies and other third parties. You can’t forget about the corporate booking tools. You can’t forget about the mid-office systems and the back office systems. Each one of these entities controls a really important element in this ecosystem. Everyone has to advance together.”
Sabre is concerned with setting up the NDC process in a way that will support key business functions as well as irregular operations—things like ticket changes during disruption, or processing refunds, without losing track of the content transmitted through NDC.
“The standards have done a great job around shop, book and pay. Every airline’s API does a really great job. The challenge we have is that the complexity happens after that…wherever I am doing voluntarily changes, or, more importantly whenever I’m doing involuntary changes—when you all are moving through service disruption—it’s really hard. The work that is required to make sure that all of these processes are in-synch, that the order stays in its current live state at all times, and that the agency always has a real-time view of that product, those are the things we still have to work through,” Morgan says.
Morgan also says that NDC has to scale—which is what prompted the 21 airlines on the leaderboard to set their 2020 target—but it won’t be easy.
“Right now, at a total level, you are at far less than 5%,” Morgan says. “A very small amount of content overall today is flowing through NDC. So this is a big leap. This is a big bold bet to get to 20%. There’s a lot of foundational work that has to get laid.”
The larger of the leaderboard will tip the scales, Morgan expects. They will have a lot of work to do to get things going, but the problems that they solve will help establish best practices for the industry as a whole.
“If you get a couple of them over the hump of 20%, things like the end-to-end ecosystem have to work out. Things like the commercial model have to get worked out,” Morgan says. “You don’t turn this content if you don’t have a commercial structure that makes sense for all of the parties.”
The New Distribution Capability (NDC) program got a boost that will also help it to scale with the creation of a new NDC Exchange platform which will make it easier and less expensive for airlines to adopt the standard.
The NDC Exchange, created by SITA and APTCO supports real-time exchange of messages though an API on pricing, shopping and ancillaries with other airlines and sellers (GDSs, travel agents, aggregators, OTAs, and TMCs). The platform will also translate messages based on non-NDC schemas like the Open Travel Alliance (OTA) XML schema.
“ATPCO recognized the growing demand for simple, cost-effective API connectivity some time ago,” said Rolf Purzer, President & CEO, ATPCO. “In our partnership with SITA, we have developed this solution to enhance the complex distribution landscape, giving everyone a clear path to incorporate all methods of distribution.”
Ilya Gutlin, SITA President, Air Transport Solutions, said: “NDC can be very disruptive for airline distribution. While it offers exciting new opportunities in the marketplace, it also presents new business and technical challenges for airlines.
SITA is teaming with ATPCO to provide an air transport community solution that will facilitate NDC adoption by reducing the complexity for airlines to establish and maintain direct connections with travel agencies and travel management companies.”
Announced in October, the NDC Exchange has obtained IATA already undergone pilot trials with major airlines including Air Canada, British Airways, United Airlines, Delta Air Lines, Finnair, and the LATAM Group. The platform has also obtained IATA NDC Level 3 certification.
“Beyond the obvious technical benefits of speed to market with an NDC-compliant API and the ability to support multiple standards and schemas, Air Canada is keenly interested in the community effect, whereby the benefit of a distribution network of like-minded partners grows exponentially with each new participant in NDC Exchange,” Keith Wallis, Director of Global Product Distribution for Air Canada said.
Airlines Reporting Corporation (ARC) has also joined the NDC Exchange, providing settlement support, and Routehappy by ATPCO is offering its rich content on product attributes and ancillary options.
Skyscanner became the first global travel search site to join the NDC Exchange in October.
“We want to bring airline products on Skyscanner’s site as close to the direct experience as possible, with carriers controlling their products and brand while benefiting from our traffic and audience across a range of devices,” said Skyscanner’s Senior Commercial Director of Skyscanner, Hugh Aitken.