NDC… what next?

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NDC... what next?

Earlier this summer I was invited to speak on a podcast organised by Travel in Motion’s partner Daniel Friedli, as part of a series of episodes about the industry’s adoption of NDC. Travel in Motion is a leading aviation IT consultancy operating globally. This was a chance to share my views on NDC and why I decided to build a business around it.

As you all know NDC stands for New Distribution Capability, an industry IT standard for a set of APIs for airlines to reduce their reliance on Global Distribution Systems, notoriously expensive legacy technology providers, to sell their content via third party travel agencies.

NDC only recently started to slowly be adopted by the world’s leading airlines as they begin to realise its potential. Indeed NDC conceptually is a powerful initiative – originated by IATA as a GDS bypass it also provides the foundations to modernise airline retail capabilities. NDC APIs are designed to support the full richness of the product across different channels and set the industry up for the basic principles of e-commerce – customer authentication, control over offer and omni-channel retailing.

During the debate i had the opportunity to share my views on the roll out of NDC and why i believe there are some critical reasons behind its slow adoption and its future.

 The implementation 

The average integration time for a large travel agent with an NDC API is 6 months per airline, meaning there are so many airlines travel agencies can connect to in a given period of time. Each airline’s API is different, business rules are complex and it requires significant industry knowledge to be interpreted. The travel agency community is resisting the initiative which is why the adoption has been very slow. 

The technology  

The problem is New-Distribution-Capability is not so new anymore. It was designed over 15 years ago on technology that was around in the 2000s, therefore no longer appropriate technology to meet the expectations of modern online retail. 

A limited proportion of travel agencies is turning to aggregators to get NDC content. I strongly believe that the aggregator model in itself doesn’t work. This is because no one wants to pay the bill for it. Airlines don’t pay aggregators and so it does not provide a cost efficient solution to travel agencies, but instead shifts the cost, leaving travel agencies or the end customers to incur the heavy costs. Hence why the majority of travel agencies stick to GDSs.

In conclusion, airlines have taken a great first step by adopting NDC. However, in order to unlock NDC’s full potential, airlines need up to date technology that will help them achieve those original goals as well as reconsider the commercials around it.

Offering a better connection with travel partners is essential to drive more adoption. Reducing costs of implementing as well as providing better incentives.  

Thinking ahead, the technology also needs to be more up to date to lay the foundation of the future of online retail for airlines. The standards designed in the 00s are not designed to provide a modern shopping experience you’d find on google, amazon, net a porter etc. 

This is why our mission at Kyte is to empower airlines with modern tools that allow them to connect with partners of their choice, or their own interfaces, more quickly and effectively.  

We want airlines to play a leading role in the development of their booking experience, whether it is direct or indirect. Our technology is designed to provide a more effective way to connect and push different products, ancillaries or bundles.  

Want to have a listen to the full episode? You can do a play back here now!

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