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Speeding Ticket Internet Distribution and the Travel Industry

In: Business and Management

Submitted By shoabmomin
Words 706
Pages 3
SPEEDING TICKETS:
A CASE STUDY OF INTERNET DISTRIBUTION AND
THE TRAVEL INDUSTRY
--- SHOAB MOMIN (13210690764)
Case Question: 1) Who are the winners at different stages of the changing travel industry?
Ans: Based on the timelines, the case can be divided into following stages.
Stage: Emergence of Global Distribution Systems (GDS):
By 1950s, American Airline’s growth outpaced its ability to manage its inventory of seats using manual methods. IBM and American Airline developed SABER for this purpose. This system eventually became control center for American Airlines.
Witnessing the success of Sabre system, IBM developed a scaled down version called PARS, targeting medium sized airlines and by 1972, 9 out of 10 major airlines operating in US were operating on IBM PARS system.
Winner: IBM is the winner of this stage as it profited the most by starting a technology race for Distribution system and capturing major market
Stage: GDS companies Dominance
The airlines that owned GDS enjoyed oligopoly with only 4 GDS operators providing flight schedule searching and booking capability for almost all travel agents in United States.They deployed various methods to bias the results of searches performed on their systems e.g Display bias, Architectural bias as well as booking fees charging higher booking fees from more threatening competitors.
Winner: Airlines Owning the GDS systems. Due to lack of government regulations, GDS owning airlines enjoyed dominance by deploying various bias methods, these were particularly effective against new, small competitors.
Stage: Government Intervention and Deregulation
Competing airlines rushed to expand their reach by installing GDS systems at travel agencies. Following deregulation in 1978, airlines competed for attention of agents, whose role in the newly complex airline travel market gained prominence.
Winner: Travel

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