On November 15, 1984 many things happened to travel agent reservation computers apart from the end of practically all display bias. As carriers operating reservation systems were required to end bias, they were permitted to revise many criteria under which other airlines are granted representation in the systems, and the fees these airlines must pay. These new arrangements are probably less than satisfactory for some carriers, and are a mixed blessing to travel agents.

Most evident among these changes are increased airline 'access fees'. Each time a travel agent initiates a reservation through his computer, for a carrier other than the host (or sponsor), the transaction costs that carrier between $0.75 and $1.85, depending on the system. For many airlines these fees doubled when bias ended -- although some airlines' fees were reduced.

To the reservation system vendors, these fees are a partial compromise between display bias, which was the old method, and requiring all carriers represented in the computer systems to pay their own way. The system vendors must show all direct flights even for airlines declining to pay the fees, but are not obligated to accept bookings or offer 'unbiased' displays to non-payers. In order to assure fair representation within the travel agent distribution network, an airline has little choice but to go along with whatever the vendor decides to charge.

The long-term impact of these access fees on many carriers cannot be measured. It is clear that such dramatic increases in such a basic cost of business h as caused some concern at certain airlines regarding not only their relationships with the automated reservation systems, but also about overall travel agent distribution of their products.

Foremost among these concerns, at least to airlines without their own travel agency automation systems, is that elimination of bias reduced the direct benefit of placing reservation systems in as many agencies as possible, but did not deal with the question of control or domination by the automation vendors, who also happen to be among the country's foremost air carriers. The net effect is that the system vendors are still strongly motivated to add agency users to benefit themselves more so than participating carriers. Access fees are an indicator of one form many industry experts believe this domination may take.

The current fees, even though they represent significant increases, are still considerably less for most carriers than if they were to accept the reservations directly or eliminate the agent altogether. Certainly these costs are less than if other carriers were to develop their own reservations product for agencies -- probably an impossible task in today's world. At this point it is also not clear that booking costs are any less than the two major automation vendors charge today even for certain of the carriers with their own systems. However, there is no long-term guarantee that these costs will remain stable.

Over time, no one can say that access fees will not reach $5 or even $10 per reservation. Given the inability of most carriers to market their product without the almost universally-automated agent distribution system, there would be no alternative to paying any increased fees, unless the entire concept of a gent distribution were reconsidered. One can readily see how severe the pressure to develop other distribution methods would be if costs continue to escalate.

The desire to control a significant portion of the agent distribution system is understandable. Not only is a carrier with a large distribution system 'protected' from access fees to a significant degree, but such a carrier also enjoys greatly enhanced penetration into the agency market, as well as extended leverage over that market.

Automation sets the tone of most airline/carrier relationships today -- to an extent many agents are reluctant to admit. Becoming a user of a reservation product is seen as aligning the agency with that carrier. Although this is partly by design the existence of so-called 'halo-bias' -- the assumption that it is somehow better or fairer to book the services of the computer system host -- should not be discounted. These relationships are believed to represent significant revenue sources for system vendor carriers, irrespective of bias.

The present system probably represents little danger to either non-vendor carriers or agents. In the short term, many carriers have the most to lose should existing automation relationships undergo significant change. This change is not necessarily detrimental to agents in any specific degree, but clearly shows the need for more strategic thinking and alignment than many have previously committed.

Here are a some possibilities and predictions which may be brought to pass by future developments:

1. There will be no 'neutral' travel agent reservation system, even though the idea is receiving more attention lately. This has not only been tried unsuccessfully already before the advent of the major agency computers which now exist, but long start-up times and intensive capital investments necessary make such projects impractical, given today's relatively modest access fees.
   
2. More increases in access fees will give some carriers a greater incentive to by-pass the agency system. Depending on individual distribution methods and route structures, this option might become cost-effective relatively soon in certain cases.
   
3. High access fees would create a tendency for carriers paying such fees to pass them through to the agency system. This would complete the 'pay your share' scenario now partly in place through the carrier access fees themselves. The pass-through might be a reduced commission or a transaction charge imposed by the affected carrier.
   
4. Were access fees ever passed-through to the agent, there could be a considerable movement to switch or add second systems to take advantage of any lower fees offered by competing carriers.
   
5. The fee concept makes it fully possible that some carriers may wish to convert reservation-making into a profit center in its own right. The major danger here is that agents may have even less decision-making control over their vendor relationships than they do now. It would be unfortunate indeed if the costs of agency sales ever became excessive, even for a few carriers, through no fault of the retailer.
   
6. There will be no great slow-down in the overall programs of most system vendors to place as many reservation systems as possible. The end of bias did not bring an end of carrier efforts to form closer agency ties, built on automation relationships. This is not necessarily bad -- sometimes good managers d o 'take sides' in their carrier dealings -- but agents are well advised to consider these relationships closely, and assure that they are built on sound economic and service-oriented reasons.