Articles tagged “global distribution systems”

TravelSky, China's state-backed airline distribution and software services company, reported solid revenue growth in 2018. But the company's insulation from market competition risks creating complacency, and some signs suggest Chinese airlines are frustrated.

Amadeus has long talked about diversifying its business, branching out from distribution into software services for hotels, airlines, and airports. But 2019 looks like it will finally be the year that the new businesses gain nearly equal importance to the old ones.

Travelport's latest earnings report is a chance to judge its performance since it went public in 2014. The answer is mixed: The company invested more than its rivals in its airline distribution business, which let it punch above its weight. But not everything on other matters panned out as well as it might have hoped.

A year ago the U.S. changed its corporate tax law. A look at the impact on travel tech giant Sabre may show, by example, the benefits to many U.S. businesses broadly. The reform appeared to give the company added financial flexibility in 2018.

Is this all just posturing in negotiations between United and Expedia? It certainly could be but filing a lawsuit about it while a contract is in place takes things to a new level.

There have been several new technologies, from the New Distribution Capability to direct-connect, and blockchain, that have at times shown promise in easing the grip of the global distribution systems. For the last 20 years, the incumbent distributors have always managed to exert or shore up their roles.

There's no guarantee that the European Commission will act on this complaint but it shows that the online travel industry is still very annoyed with Lufthansa's actions.

The early consensus is that Elliott Management put together a disappointing deal for investors. We cover the case for and against the deal here. But expect larger Travelport investors to consider resisting the deal or hope that a white knight acquirer rides in with a better offer.

The long-predicted buyout of public-company Travelport has happened at a premium of about twice the market capitalization of the company. Expect a spinout of the company's eNett payments division and the proverbial "cost restructuring."

This year Lufthansa made a series of small moves that, when looked at together, reveal a doubling down on its multi-front strategy to pressure Amadeus, Travelport, and especially Sabre to conform more to its preferred airline distribution practices. Connect the dots, and it looks like a low-grade war.