Re: Article from bizjournals.com: Worldspan bringing 'transparency' to airline ticket prices

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...I consult Clarkhoward.com everyday for the ATL El
Cheapo fares.....I am a big fan of his (he is no fan
of the 'Big Six' either). I am surprised he made this
deal with WorldSpan.....

Bryant Petitt
Cumming, GA
--- dmueller7@lycos.com wrote:
> Hello from bizjournals.com! David Mueller
> (dmueller7@lycos.com) thought you
> might like the following article from the Atlanta
> Business Chronicle:
>
>
http://www.bizjournals.com/industries/travel/airlines_airports/2003/02/17/atlanta_story8.html
>
> Worldspan bringing 'transparency' to airline ticket
> prices
>
>
> Mary Jane Credeur  Staff Writer
>
------------------------------------------------------------
>    Worried about paying too much for airline
> tickets?
>
>    A new service by travel e-commerce firm Worldspan
> L.P. will let buyers
>    compare today's ticket prices with historical
> prices over the past 12
>    months.
>
>    Atlanta-based Worldspan's FareAware search
> service goes live Feb. 14
>    exclusively through local consumer advocate Clark
> Howard's Web site (
>
>    http://www.clarkhoward.com
>
>    ). The site is free for users, and Worldspan gets
> a small cut of every
>    ticket purchased through the FareAware service.
>
>    "The fare structure is very complicated and we
> believe this will help
>    reduce some frustration and angst the customer
> has toward [booking]
>    travel," said Worldspan CEO Paul Blackney. "This
> is an opportunity to
>    give the consumer more information and help them
> book travel
>    efficiently."
>
>    No other travel booking company or airline
> currently offers a 12-month
>    ticket pricing comparison tool.
>
>    Industry watchers say the availability of such a
> tool might make some
>    airlines uncomfortable because it lends more
> transparency to their
>    opaque pricing practices and may lead some
> consumers to hold off on
>    travel until ticket prices come down. Worldspan
> is jointly owned by
>    subsidiaries of Delta Air Lines Inc., Northwest
> Airlines Inc. and
>    American Airlines Inc.
>
>    "Airline prices are more fickle than Hollywood
> marriages — one minute
>    they're up, one minute they're down and there are
> a lot of outside
>    forces that come into play," said Henry
> Harteveldt, senior analyst with
>    Forrester Research Inc. "There are capacity
> issues and competitive
>    issues, geopolitical and economic factors. Buying
> an airline ticket is
>    not like going to the Gap and buying a T-shirt."
>
>    Deflated or depressed airline prices are
> especially critical as airlines
>    struggle to recover from the 2001 terrorist
> attacks and the lingering
>    recession. Additionally, the current model of
> airline pricing and
>    operations returns razor-thin profits, if any
> profits are made at all.
>
>    "It's nearly impossible for these guys to make
> money because they have
>    to sell 80 percent or even 90 percent capacity
> just to break even, and
>    these thresholds change every day on every flight
> for every route,"
>    Harteveldt said.
>
>  'Pandora's box'
>
>    Inspired by the Internet e-commerce boom, online
> travel booking services
>    like Expedia Inc., Travelocity L.P. and Orbitz
> LLC were created in the
>    late 1990s to snare more revenue on distressed
> inventory and unsold
>    seats.
>
>    Online services quickly claimed nearly a quarter
> of all air travel
>    bookings, and conditioned consumers to conform
> their travel plans around
>    the availability of cheaper flights.
>
>    "There was a sea change when information moved
> from the travel agents
>    directly into consumers' hands, and there is no
> going back," Blackney
>    said. "Pandora's box was opened when you gave
> people the Internet."
>
>    Now Worldspan wants to push more information out
> to the consumer.
>
>    FareAware has been under development for nearly a
> year and cost
>    Worldspan about $1 million to build, although the
> company relied heavily
>    on its existing ticket processing technology to
> make the new product
>    work.
>
>    Worldspan gathers its historical fare data from
> the 5.8 billion travel
>    transactions it processes each month, then
> compares that data against
>    current lowest prices for tickets on specific
> routes.
>
>    Unlike many fare-search tools that are led by
> less-flexible departure
>    times or dates, FareAware is led by ticket
> pricing first and shows date
>    and time availability later during the search.
>
>    The idea is to help consumers navigate the
> complex airline ticket
>    pricing mechanisms by giving them another data
> point to consider when
>    buying tickets, said Niel Bainton, vice president
> of strategy and new
>    business development for Worldspan.
>
>    "If consumers are flexible, FareAware can help
> them book tickets in
>    advance at a very good rate," Bainton said. "This
> helps create some real
>    transparency [to ticket pricing]. Nobody else has
> ever offered a
>    historical pricing benchmark before."
>
>    At first, FareAware will only include 15
> departure cities and limited
>    destination cities based on high-volume routes.
> The service is available
>    only through Clark Howard's site because
> Worldspan wanted to position
>    the product as a search tool for budget-conscious
> leisure travelers.
>
>    Howard met with Worldspan a year ago when
> FareAware was under
>    development, and informally shared his views on
> what consumers would
>    want in such a product.
>
>  New models
>
>    Although Howard has not endorsed FareAware, he
> believes the concept is
>    "brilliant" and that every business that books
> travel tickets or
>    reservations will soon have "clear and obvious
> pricing models."
>
>    "Most pricing models today are tired and outdated
> — it's a matter of
>    'Let's see who we can con into paying too much
> for their ticket,' "
>    Howard said. "The industry is moving to
> transparency in pricing, but
>    it's kicking and screaming the whole way."
>
>    Howard says Web sites for discount carriers like
> AirTran Airways Inc.
>    and Southwest Airlines Co. have some of the most
> straightforward pricing
>    models available.
>
>    "Instead of trying to play a game of hide and
> seek, they lay it out for
>    you and show you all the prices they have for
> these flights at these
>    times," Howard said. "How great is that? People
> understand that, and
>    they trust that."
>
>    Although analysts believe the FareAware service
> may "raise the hackles"
>    of the Big Six full-fare airlines, all of the
> carriers are under
>
=== message truncated ===


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