7 September 2006

Travel Technology - Then & Now

Traditional travel technologies focus on the rudimentary tasks of booking travel, but the market demands a single source to support the full spectrum of travel logistics. With respect to the Travel Industry Supply Chain, there can be various technologies involved to address specific needs catering from the traveler seeking a simple, efficient travel and service purchasing experience, to the operations, security and procurement directors extracting data on-demand for critical business decisions.

The backbone of the travel industry’s growth is its complex distribution network of suppliers and intermediaries.Travel specific technologies revolve around the “Reservation and Distribution System”. Travel distribution infrastructure has evolved over the years to support the changing needs of the industry.

Initially manual systems required centralized reservation centers, groups of human beings in a room with the physical “cards” that represented inventory. Quickly, a network concept emerged, which connected the various ARSs (Airline Reservation System) together and made them available to travel agents. This became known as the CRS (Computerized Reservation System) concept.

Just as the invention of the ARS enabled the automation of flight and seat control within an airline, the CRS concept automated the reservations process by placing the reservations technology for all airlines on a travel agent’s desk, eliminating the need for the travel agent to call the airline to make reservations. This enabled the travel agent to spend more time helping the traveler and enabled the airline to, in essence, outsource the telephone reservation process.

With the introduction of what is now referred to as the GDS (Global Distribution System) came the pioneering of many remarkable time tested concepts; the first commercial real-time application, the concept that computers had applications beyond number crunching, data can be presented remotely and maintain integrity and Electronic Data Interchange (EDI) within a supply chain

The internet not only fragmented the itinerary by rewiring the traditional travel distribution supply chain, but also made limitless GDS (Global Distribution System) data available to the consumer not accustomed to precision shopping. This unfiltered burden on the GDS data sources has driven the cost side of the efficiency equation through the roof.

The travel industry changes very rapidly. Trends of two years ago are often reversed, and budget travel strategies that worked in the recent past might not be of much value today.

Technology is changing the underlying infrastructure and business practices of travel distribution. The traditional value chain of supplier to wholesaler to retailer has been permanently altered. Suppliers and wholesalers are becoming retailers, while retailers have embraced a merchandising model to become wholesale package distributors. At the heart of this change is a shift from old mini-computer-based systems to open distributed technology that dynamically combines content to meet users' preferences.

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