By: David J. Wardell

© 1997 By: David J. Wardell.  Reproduction or redistribution in any form without written permission is strictly prohibited.

The challenge in evaluating any new travel reservations project is substantial—once the philosophical issues are understood it becomes very difficult for someone to "write the check." Thus while compelling proposals are continually developed achievable results usually disappoint their proponents.

The last serious "non-aligned" CRS initiative was NIBS (the Neutral Industry Booking System), launched as a result of a round of industry discussions in the mid 1980s. Two branches of those discussions (although separate from NIBS) ultimately lead to the creation of Galileo and Amadeus.

In 1985 I wrote a piece for Travel Weekly about NIBS called "Who Needs a Neutral System?" Although recast in the 1990s the issues are essentially the same now as then: the existing CRS-centric distribution system works very well for those airlines that are in the business of enfranchising "dealerships."

Usually they're not called by that name, but the relationships between some airlines and their key agencies amount to the same thing. The CRS is among the most visible and tangible manifestations of the distribution system and the relationship between agency and supplier.

Those relationships can also be highly profitable, and thus they receive many votes of support:

• Agents vote for them when they accept financial incentives from vendors that are frequently unrelated to performance or functionality.
• Corporate travel buyers vote for them when they support travel service proposals that are barely economical and would not be feasible at all were it not for the financial incentives available to the agency.
• Vendors vote for them when they give agencies few other practical financial alternatives.
• Technology companies vote for them by developing travel products that perpetuate inefficiencies and do not focus on truly lowering agency operational costs.

I suspect that when, the time comes to "write the check," most agencies would prefer closer "dealerships," not weaker ones. How quickly we forget that there have been non-aligned CRS.

The most successful was Marsplus, operated by a number of owners in the late 1970s and early 1980s. While technologically competent in its early days the product was quickly eclipsed for a number of reasons, including the "dealership" problem just mentioned and the support and development limitations imposed because neither owners nor subscribers found a way to write big enough checks.

Technology and the travel marketplace have changed, but let's not forget that among the most dangerous words in business are "This time its different." Although people get nervous at new CRS technology price tags discussed in the $20 million range, let's be very clear: for systems with the characteristics and of the complexity of a new generation CRS, $20 million would be very cheap indeed.

"But," it is said, "don't vendors want lower CRS fees?" They clearly do, but the idea that this goal should be achieved through a new CRS runs counter to the larger trends, not confined to the travel industry, that today's technology is fueling.

People that are immersed in excessive Internet hysteria, for instance, frequently miss the key point that The Internet enables what has been termed "disintermediation," meaning the elimination of systems, processes, and costs that distance vendors from their customers. Building a new, cheaper CRS, conceding it is technologically, financially, and practically possible, simply replaces the old intermediaries with new ones.

As with most new proposals, the difficulty of revolutionizing the CRS industry will likely produce disappointment once writing the checks starts.