It’s nearly impossible to ignore the current economic anxiety that exists throughout the nation and in our industry these days, yet some companies are truly masterful when it comes to their willful ignorance. Whereas advance bookings are up overall for 2008, agency owners I spoke to recently have yet to see the revenue from these bookings and are starting to worry that consumers might be rethinking travel plans. What a few months ago could be described as cautious optimism is rapidly turning into gnawing concern.
“January will be an important month for a lot of agencies,” said one owner. “That will give us a pretty good indicator of what kind of hit we’re looking at.” Into this worrisome market arrives a recent report that Travelport (owners of the Galileo GDS) will be initiating a per-segment fee of $1.25 to be paid by travel management companies who book Southwest Airlines via Galileo. Apparently unconcerned by the economic pressures already being felt by agencies, Travelport decided the time was right to shift costs to the users.
“Regardless of how stupid Southwest thinks travel agents are, no intelligent [travel management company] that understands the economics and the threat to the future of airline distribution will ever book even one Southwest segment via Galileo with the current model,” said Joe McClure, of Montrose Travel, in a story by the travel newsletter, The Beat.
ASTA has also advised agents to think twice before using Galileo to book Southwest, citing other options such as rivals Sabre and BookingBuilder.
For its part, Galileo and Southwest insist the fees are worth the additional services and “content” users will receive.
“Galileo sets its own rates and charges and we don’t have influence over that,” said a Southwest spokesperson quoted in The Beat story. “When this agreement is complete, Galileo will offer more Southwest content than any other channel, besides its own Web site. Based on the many requests over many years, we feel there is value in finally making content available. As for the program or model itself, this is not unlike other industries where the end user pays for content, such as downloading a song or movie from a Web site.”
Apparently, this person doesn’t realize that customers don’t have to pay a surcharge for the opportunity to purchase music or movies from a site, but just for the actual product itself. Or, more likely, it’s another case of willful ignorance. K.S.