Travelport's announcement that it is bringing all of its GDS advertising business in-house -- and it is the first major GDS to do so -- is a fairly momentous development because it breaks TravelClick's near monopoly on green-screen advertising.
Until Travelport's announcement, TravelClick handled virtually all the advertising sales and ad-serving for Travelport GDS [Galileo, Apollo and Worldspan], Amadeus and Sabre.
The adds typically are messages from hotels about promotions and specials, and they appear on travel agent's green screens.
With Travelport's decisions to have its own sales teams exclusively handle this advertising and to use an ad-serving platform of its own choosing, TravelClick is losing a very substantial percentage of global green-screen real estate.
TravelClick is heavily into handling advertising for hotels and GDSs so Travelport's initiative is by no means a knockout punch for TravelClick, but assuredly it hurts.
For Travelport, which is slated to launch its Universal Desktop in the U.S. later this year, the move means it can earn higher margins in its advertising programs by eliminating a middleman.
The advertising business is a high-margin affair, and many travel e-commerce players are seeking to get the most out of it.
Travelport's execution of the strategy will answer the question of whether TravelClick or Travelport's own sales squads can handle the business more efficiently.
The other major GDSs -- Sabre and Amadeus -- assuredly are monitoring Travelport's initiative.