Most of the discussions regarding new GDS alternatives have centered on the suppliers' point of view. The debate has almost always focused on whether the segment fees that airlines pay the GDSs are too high.
But G2 SwitchWorks is working the other side of the street: It is banking on the notion that after 30 years of working with traditional GDSs, travel agents are ready for some new technology.
That's not to say that the company is ignoring the longstanding beef that the airlines have with GDS pricing. It intends to charge 80% less than the incumbents, according to Alex Zoghlin, president and chief operating officer.
Zoghlin, has some familiarity with the agent's point of view: He was chief technology officer at Orbitz and dealt with many of the same issues that offline agencies deal with. And there may be other pertinent influences from his past: His mother was a travel agent.
"Unlike every other person wanting to do this" -- offer a viable alternative to the traditional GDSs -- "we provide a holistic distribution solution to the agent," Zoghlin said.
Today's travel management companies all look the same, he said, because "they all represent the same GDS functionality."
For three decades, traditional GDSs operated on the assumption that a well-trained intermediary would always have to be there "to type keys," Zoghlin said.
The Internet and the advent of online travel sellers have turned that assumption upside down. For many travelers, booking online has become second nature, and they like the sense of control. Technology also is enabling them to execute an increasing number of complex functions.
Not long ago, for example, the ticket exchange process was thought to be so complex that it would require the assistance of a live agent for a long time to come.
"But we've automated the ticket-exchange process," Zoghlin said. "We provide a matrix of alternatives, and with one click, it can be done by the end customer in 15 seconds."
Automating such functions does not threaten the agent with extinction. "The end result is that it makes the agent more efficient, and it saves the agent $3 to $11 per ticket."
There are "hundreds of examples" of seemingly complex functions that can be automated, Zoghlin said, freeing agents for more productive endeavors.
And their clients will appreciate it. "The end consumer doesn't want to have a 20-minute telephone call in order to use the credit from a ticket issued six months ago," Zoghlin said.
G2 SwitchWorks is planning to give travel agents all the content that GDSs provide plus a host of additional connections.
It has signed agreements for direct connections with seven carriers and is in production with six, Zoghlin said. But it will not work solely with airlines; it will work with car rental, hotel and other companies.
It will use ITA Software's fare shopping engine; ironically, ITA also is entering the GDS alternative arena (TTU, Feb. 8, 2004).
G2's system has three components:
- TrueSwitch, a transaction switch that "sits on all suppliers" and enables travel agents to control and manage the booking channel by travel product, product cost, transaction type, customer or even distribution cost and volume.
- The agent interface and the so-called "super PNR," which automatically builds a passenger record with all trip components, regardless of their source or how they are booked.
- TrueConnect, the direct connections to carrier systems.
Like ITA, G2 says it can challenge the GDS incumbents not only on price, but on technology as well.
"You should be able to say, 'I want all of GE's travel on United Airlines in the last six months,'" Zoghlin said. "You can't on a GDS, and they should be embarrassed about that."
The technology also happens to be much cheaper. "A team of 50 people can replicate and far surpass what a GDS does at 1/100th of the cost," Zoghlin said.
As for the argument that the new systems will not be able to replicate the robust nature of the GDSs, which have had a good record of uptime over the years, Zoghlin said, "The fact is that if every single person on earth were using our system, we would not hit our limit." That was a good argument 10 years ago, he said, but it's a dead issue now.
G2 will offer the system to very large agencies for free, he said. "We'll do all the work, dedicate a team for the life of the relationship and open up the system to modify and develop features and functionality for them," he said.
As the size of agency decreases, G2 will take a more off-the-shelf approach, and the agency will pay for it. But even the smallest agency will be able to get access to all content, no matter where it's at, Zoghlin said. And the smaller an agency gets, "the need for our services increases," he said.
G2 is planning to launch the domestic airline portion of the system at the end of this month.