Further to today's exchange re. the perfect storm for airlines.... > > From Travel Management DailyŠ, June 3, 2002 > ++++++++++ > IATA IS ANGLING to implement a new sales agency agreement that could > prompt some foreign airlines to adopt zero base pay globally as well as > effectively curtail offshore ticketing arrangements designed to circumvent > commission cuts in the U.S. The issue will come to a head in Miami in late > June when the IATA Passenger Agency Committee meets to consider language > for a proposed agreement that for the first time says agencies are > entitled to "fair remuneration" for selling air tickets. IATA is expected > to fight the wording or anything like it, contending such language could > be interpreted as obligating carriers to pay commissions. ----------------- Seems like the airline industry kind of gets it. I don't think IATA can get this done as quickly as they say - imagine the airlines all agreeing in so short a time? It will be interesting to see how IATA pulls this off. It is fascinating to watch supplier desperation to maintain control on a business model that no longer works very well. Seats are commodities, nothing more. The pricing models are not as powerful because the paradigm has shifted power to the consumer....it is a demand driven model now. Imagine being in a business with fantastic capital costs, horrific labor problems (~40% of all costs) and no real pricing control. (IMHO) Some concerns - Is this not some kind of global collusion? Which law applies here? Can IATA actually do this? What happens if one small place decides to keep commissions in place - hypothetically Tonga - all agencies then run their sales through there to keep their revenues. The tax implications are fantastic - who pays tax then? And whose taxes apply? Ah, the beauty of the Internet!