The New Distribution Capability (NDC) is an additional treatment, but not a panacea, to modernize distribution of airline content.
NB: This is a guest viewpoint by Decius Valmorbida of Amadeus, the global distribution system.
The new messaging standard proposed by airline industry group IATA is an element of a much broader endeavour: how to bring innovation and increase industry profitability.
For such an endeavour to be truly successful and meet expectations, it is critical to have all travel intermediaries on-board to deliver and adopt this next step to modernize distribution.
Later this month, the aviation industry will convene in Dublin for IATA’s World Passenger Symposium.
The agenda promises a heavy dose of discussion about the NDC messaging standard, with no fewer than ten panel sessions devoted to the topic. I have little doubt that the formal discussion in the hall will be matched by discussion and speculation outside.
As a relative newcomer to IATA events, due to my recent appointment as the vice president of distribution marketing for Amadeus, I look forward to immersing myself in the debate and playing a full and constructive role – not least on the platform in a panel discussion myself.
While being new to this arena means I may have some catching-up to do, it can also be an advantage to see the situation with a fresh pair of eyes – especially given my background in, and knowledge of the needs of, travel intermediaries.
It is clear that NDC has created some division in the industry, some say leaving us at a turning point on the map. I believe that this is a misreading of the situation. We are not at a turning point on the map, rather the map is still being drawn-up before our very eyes.
My opinion is based on the much more nuanced reactions that I have received when speaking directly with both our airline and travel intermediary customers.
The most consistent message I’m hearing is that the industry simply wants to modernize distribution faster, in order to maximize value for the whole of the travel chain. And they want to do so in a way that is both channel and business model neutral.
The same needs appear again and again: merchandising, personalisation, cost-efficient and cost-effective solutions, differentiation, etc.
Although potentially part of the solution, IATA’s NDC messaging standard does not provide the definitive solution for such ambitious goals. Unfortunately, rather than clarify the way forward it has led to a great deal of industry speculation over whether NDC will ever actually take-off.
In my view, this recent debate is simply a proxy for a much larger discussion which has been going on for some years, and will no doubt continue for many more: how to bring innovation to travellers and increase industry profitability.
Amadeus's view
We believe that the industry can modernize distribution at a faster pace.
Firstly, the industry will enable airlines to reach their consumers with a richer and more varied offer and, secondly, it will provide an efficient and user friendly experience to consumers and a productive environment for the airlines and intermediaries serving them.
The question is therefore: what is the best way to make this happen?
Amadeus has over 25 years of experience in the travel industry both as a global distributor and IT provider to the airline industry and travel intermediaries. We can and will contribute positively to this debate and help make the requirements of airlines a reality.
To achieve this, our recommendation is that first we must reconcile the business requirements of all stakeholders across the value chain, including both the airlines and the travel intermediaries (in particular the corporate buyers within that category). Next these requirements should be translated into functional requirements. Only once this has been done will the industry be ready for the next stage: to design the transformation of the current technical infrastructure.
Messaging via XML is certainly part of the solution to manage enriched content and personalisation. Amadeus has been investing in XML connectivity since 2006. However, it is only a part of the solution, and technical standards alone will not bring the innovation and adoption necessary to extract the full value from the distribution chain.
Amadeus believes that it can definitely help the industry overcome these challenges. We have the technical expertise, know-how and relationships with travel intermediaries needed to help the industry come together and successfully modernize distribution for the benefit of all.
I look forward to meeting many different stakeholders at the World Passenger Symposium later this week. I am very keen to hear your many views and suggestions on how we can all work together in the best interests of the whole of the travel industry.
NB: This is a guest viewpoint by Decius Valmorbida, vice president of distribution marketing, Amadeus.
EARLIER: In August, we presented a viewpoint by Aleks Popovich, senior vice president for financial and distribution at IATA: Fear and loathing in airline distribution (aka NDC Phobia).
And here's IATA's video demonstrating the overall NDC concept: