It's all About the Relationships

June 30, 2013

 ...GDS providers once controlled over 80% of all air tickets. 

 

In the 1980s and 1990s, the Global Distribution Systems (GDS) were the 800-pound gorillas of travel distribution. The four dominant GDS providers controlled over 80% of all air tickets.  This market control allowed the GDSs to raise fees at will on a captive clientele of hoteliers and airlines dependent on the reservations they delivered as a calf depends on the cow. 

 

Today, they are in not quite the dominant position they once enjoyed for a variety of reasons.  This article examines how they rose to a controlling position and then faded somewhat by looking at changes in some of the key relationships between travel suppliers (i.e., hotels) and distributors (such as GDSs, not to mention brand Central Reservation Systems and of course, the rise of the On-line Travel Agents (OTAs)).  Looking at these relationships will give us some clues as to the shape of the distribution market for the future.

 

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