Two issues must be resolved before China can experience explosive growth in online travel, and neither is insurmountable, according to participants at TravelSky Technology Ltd.'s China Travel Distribution Future Forum 2005 in Beijing.
The first is widespread implementation of electronic ticketing in what is expected to become the world's largest travel market.
The second issue may prove more challenging: facilitating online payment for online purchases in a country in which credit cards are relatively scarce.
Participants at the forum, who addressed a standing-room-only audience of travel agents, technology providers and other industry players, agreed that e-ticketing eventually will take hold, but for now it faces obstacles that are familiar to observers of its development in the West.
In China, "there is no interlining in e-ticketing," said Sun Ji, manager of China Air Service Ltd., a large travel agency. "Changing a ticket is difficult." But he noted that 80% of e-ticket users who do not have to make changes express a high degree of satisfaction with the process.
Several international carriers have introduced e-ticketing, and Zhang Lan, director of Air China's commercial committee, said it will become China's first interline e-ticketing provider when it implements an agreement with United Airlines next month.
But the industry needs to put more money into technology so that e-ticketing can move forward, she said.
The issue of payment is more complex. Justin Xiong, founder and general manager of Yoee.com, noted that China has "a highly developed debit card system." But there are no wide network systems of debit cards, such as Visa or Mastercard; each bank issues its own, and connecting with all them is daunting for online sellers of travel.
In addition, many banks place spending limits on single purchases and/or daily spending via debit card in order to combat fraud, and often those ceilings are too low in some cases, about $125 for the purchase of an international airline ticket.
As a result, many online transactions are completed in convenience stores.