Collapse of Travel Distribution Charlie Crissman, TRX

1
Collapse of Travel Distribution Charlie
Crissman, TRX

• Travel Distribution sale or purchase of options
  to fly, drive, ride or sleep Transactions are
  increasingly 100 electronic no voice, no paper
• Does the term distribution potentially bias our
  discussion?
• Rapid changes for travel industry intermediaries
• Travel agencies
• Travel Management Companies (TMCs)
• Online Travel Companies (OTCs)
• Technology providers
• Global Distribution Systems (GDSs)
• How will the role of intermediaries evolve over
  the next three years?

September 21, 2004
2
Collapse of Travel Distribution Charlie
Crissman, TRX

• Changing standards for Corporate Travel
  distribution and management
• Regulatory Rollback of GDS regulations
• Operational Growth of Internet shopping and
  self-service
• Commercial Rapid change in buyer and supplier
  expectations
• Why the intense focus on distribution? Because
  it is a controllable cost
• Airlines have less control over fuel, labor,
  equipment leases
• Travel managers have less control over travel
  frequency, supplier rates
• Broad acceptance of online tools has changed
  expectations
• Suppliers and buyers see the viability of more
  efficient, less expensive options
• Intermediaries feel pressure from both sides to
  justify value

September 21, 2004
3
Purchasing Trends
Collapse of Travel Distribution Charlie
Crissman, TRX
September 21, 2004
4
Collapse of Travel Distribution Charlie
Crissman, TRX

• Demand for increased efficiency
• Growth of supplier direct reservations
• Growth of self service online booking adoption
• Touchless reservation processing (ranges from
  30 95)
• Pressure to decrease operating costs
• Increased demand from CFOs to justify managed
  travel programs
• Need for consolidated data and analysis to
  measure program value
• Use of alliances and outsourcing to shed fixed
  costs
• Focus on total travel expense vs. component parts
• Future models for intermediaries
• The urge to converge will TMCs and OTCs meet
  in the middle?
• Importance of inventory access who can/will
  provide access to what?
• Concern about viability of relying on a single
  GDS bias, optional participation
• More options more opportunity for competitive
  advantage

September 21, 2004