Airline ticketing war deepens
(Bloomberg News) — Sabre Holdings Corp., a provider of airfare data to travel agencies, will stop carrying American Airlines flight information in August as a dispute over online ticket sales escalates.
That's a month earlier than the termination date of Sabre's contract with American, which was told of the move today, Chris Kroeger, senior vice president at Sabre Travel Network, said in an interview. Sabre, a former American unit, will end discounts for the airline and change the display of its listings until then.
American pulled fares from travel agent Orbitz.com on Dec. 21 as the carrier focuses on its own system to share prices, bypassing data distributors such as Southlake, Texas-based Sabre and travel sites including Orbitz.com. Expedia Inc. blocked American fare data on Jan. 1.
"American has taken action to impose a costly, unproven and unnecessary system, while withholding some fare content," Kroeger said in an interview. "It makes it harder and more costly to comparison shop."
Spun off by Fort Worth, Texas-based American in 2000, Sabre was acquired by units of buyout firms TPG Capital and Silver Lake in 2007. The company's holdings include travel website Travelocity.com.
Sabre declined to say how the listings for American's data would change for the duration of the contract, or how much revenue comes from the airline. Carriers usually pay a fee for each trip to fare distributors such as Sabre, and then an additional incentive payment to the online travel agency used to book each flight.
LARGE DISTRIBUTION CHANNELS
Ryan Mikolasik, a spokesman for American Airlines, couldn't immediately be reached for comment.
American, the third-largest U.S. airline, is the first major carrier to pull fare data from the large distribution channels. Delta Air Lines Inc. stopped selling tickets in December through CheapOAir.com, OneTravel.com and BookIt.com.
Delta Chief Executive Officer Richard Anderson told analysts in April 2009 that airlines eventually might match "the model of other industries," with outside parties paying for access to data such as fares instead of charging carriers to disseminate that information.
American is still in talks with Expedia to reach a "mutually beneficial agreement" that includes the airline's "Direct Connect" system, Mikolasik said yesterday. Expedia has said it remains open to "doing business" with American.
Orbitz.com parent Orbitz Worldwide Inc. has estimated that about 5 percent of its revenue for 2010's first nine months came from American tickets and associated products such as rental cars.