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Rumors of Their Demise Were Clearly Premature

Hotel & Restaurant Technology UPDATE, Spring 1999

The Global Distribution Systems are Reinventing Themselves, Repositioning Themselves as Continued Mainstream Booking Participants.

Yes, I was one of them . . . There was a time when I, too, thought that the Global Distribution Systems were approaching extinction.  I now think otherwise!

With the completion here at Hospitality Technology Consulting of the 5th Annual HEDNA Survey of GDS Hotel Bookings, the GDSs visibility, and importance as reservations channels, is clearer than ever.

Most recent HEDNA survey of GDS Hotel Bookings determined that GDS reservations for hotels increased 12.2 percent in 1998 above 1997 levels, to total 39,828,000 net bookings.  For the sixth consecutive year, GDS bookings experienced double-digit growth, with 1998 bookings virtually double those of just 5 years earlier.

I attribute this growth and vitality to two primary factors.  The first is the still-expanding use of GDSs by travel agents to place hotel reservations, most especially travel agents situated outside of North America.  The second influence in the powerful upward momentum of GDSs is their assumption of new roles as booking engines for many Internet travel sites.  Once thought threatened by the Internet (and possibly in the long run, still so) GDSs have realized an immediate benefit as they gained recognition by Internet travel site developers as both uniquely rich repositories of up-to-the-minute travel data and fast, powerful and reliable reservation processors.  As a result, Amadeus, Galileo, Sabre and Worldspan are taking on increasingly frequent roles as web site booking engines.

Secondary Factors

Supporting these two primary factors contributing to continue GDS relevance and vigor are a number of additional initiatives undertaken by most, if not all of the systems, to counter the function and performance limitations imposed by their legacy technology and initial designs.  Two I believe most significant are new user interfaces for their travel agents and seamless connectivity.

Each GDS has installed, or is in the process of installing, Windows-style, PC-based user interfaces.  Full color, graphics-capable displays allow faster more efficient information communications to the viewer.  Further their intuitive design shortens the user learning curve by eliminating cryptic displays and the need for arcane booking commands.  Moreover, the capability to instantly access the Internet, via the GDS display, for research or other purposes, heightens the GDS subscription value still further.

Data display shortcomings, which could not be overcome with the new user interface, are being mitigated (at least for the hotel industry), by the introduction and subsequent expansion of seamless connectivity.  Data storage limitations of the GDS data base have been surmounted by retrieving considerably more extensive product descriptions from the hotel company's central reservation system, then instantly displaying that information on the GDS user's screen.  Two or three line descriptions have replaced three letter product codes, such as A1K, to significantly enhance the sales process.

Indeed, a description chaining function as offered by Galileo, for example, allows hoteliers to transmit even longer product descriptions, to fully and enticingly present packages and multifaceted promotions.

Through these and similar innovations the Global Distribution Systems are reinventing themselves, in doing so repositioning themselves as continued mainstream booking participants.

No, GDSs are not dead and will not be soon -- they remain a vital reservation delivery channel for the hotel industry.