The airline industry has moved past questioning the transition to OOSD (Offer-Order-Settle-Deliver) and is now actively implementing it, with strong momentum from contracts and RFPs. NDC is gaining traction as a precursor to full retailing, often driven by continuous pricing goals, with over 90 airlines now having NDC agreements with GDSs. Modularity is a key aspiration, allowing airlines to mix components from different vendors, but challenges persist, including integration complexity and contractual barriers. IATA’s slow progress on standards, with a full set not expected until 2028, risks allowing dominant vendors to set de facto norms, though some standards are emerging from real-world implementations. AI is a pervasive topic, with vendors embedding it into products, but its effect on look-to-book ratios remains debated—while AI agents could increase search volumes, smarter caching and more efficient queries might mitigate this. Crucially, success with AI will depend on access to consumer data, content, and domain knowledge, not just the technology itself, as AI becomes commoditized. Overall, the industry is navigating a complex shift toward modern retailing, balancing technological innovation with practical challenges in standardization and integration.
[Music] Hello and welcome to T2RL Talks. With the excitement of a conference season now behind us, we've had time to draw breath a little bit and look at the current state of the industry. And T2RL has just published its quarterly update on the transition towards OOSD offer order settle deliver. And to talk about that and generally what's going on in the world right now, I have three guests in the studio. I have Bert Craven, the Head of our Technology Practice and Deputy CEO at T2RL. Ian Luck, the Head of our distribution practice. And joining us for the first time on our podcast is our fairly new Head of Research Amanda Campbell, who actually drafted the report that we're going to be talking around. And I'm sure Amanda will add some sense to the otherwise interesting ramblings of the three of us. So, welcome Amanda. Thank you. So, essentially, one thing that I took out of the conference season and I don't think it's a big surprise is that the industry is definitely started on a transition towards what I after calls modern now I'm retailing and we call OOSD. Whereas maybe a year ago there was a question still a question of is this really going to happen? I don't think that question exists anymore. Would you agree Bert? Yes, I think so. There certainly seems to be enough momentum now in terms of implementations that we're seeing going on and contracts that are being signed and RFPs that are being run or being prepared to be launched. So, I would say we are well and truly into the swing of things now. And the sort of distribution angles in it's sometimes a little sobering to realize that NDC was first announced 13 years ago. And for a long time it seemed to be the ultimate slow burn. But I think where we are now seeing a lot of airlines embracing the new distribution technologies and committing to it. I think that's right. We're seeing more and more airlines launch NDC one way or the other. Some agreements more agreements with Xcelia with Amadeus and Saber ones recently. More GDS NDC agreements and we're here from Amadeus saying they have quite a few airlines now that are sort of 30% of their distribution is going on. And their distribution has shifted quite a few in the teens that there's definitely a lot more momentum and most of the airlines we're talking to now. They haven't got NDC already. It's in their roadmap. Sometimes because there's you know interested in distribution change a lot of them because they're thinking about OSD and they're thinking about how do they get continuous pricing to market and they're thinking sort of longer term. Yeah, we see as the first building block. I think that's certainly the case as far as I've observed it. NDC when it was just an API for distribution got some interest. It was it was gaining a little momentum. But now that people are really thinking through the changes to the way they want to present their office to customers and to the market in general. It's really seen as a precursor to the full move to modern retail. Yeah. And there are definitely some airlines who almost the only reason they're doing NDC is because of particularly continuous pricing. They're launching continuous pricing. They're going to put that in their website. They want to get that out to the indirect channel and the NDC is the way to do it. Then they're not necessarily thinking about NDC is a big distribution disruption as some of the earlier airlines were. There's still there's still both out there, but there's definitely some people are quite focused on content and pricing and so on. Yeah, and picking up on something that you did say there, the GDS is are signing up significant numbers of contracts now. Amanda, when we were putting the report together, I think I remember that at least 90 airlines now have got NDC agreements with one or more GDS is. It's been significant uptake all right. And I think we're seeing more and more news and announcements around that topic every month. So it's certainly an area to watch. One of the big selling points for OSD is that the OSD systems or suites of systems will be by necessity more modular than PSS has historically been. It was a big theme at our engage conference in September and it was if anything an even bigger theme at the IARTA world passenger symposium earlier this month. On the other hand, most of the big announcements we've seen so far have been from airlines that are planning to take the whole kit and caboodle from one vendor people like finair and British Airways idea, Virgin Australia and so on. But do you think this aspiration for modularity is going to be fulfilled? I think if airlines have a modularity aspiration, then the opportunity is probably greater now than it has been historically not all airlines do. I mean, you know, it's a, you know, this argument about the diversity of the vendor portfolio and modularity and internal cost and risk of integration. So on as being going on for years long before OSD. I think, you know, OSD is providing some new opportunities, but it's also presenting some new challenges because, you know, as poor as the integration opportunities were in the legacy stack, at least they were through standard well known interfaces and message formats. And some of those are missing going forward. I think the other issue is that we see a lot of announcements that say, you know, airline access signed up with vendor why and so on. It's not always clear how much of a commitment there is, I mean, the assumption is that it's to the whole stack. But that is not necessarily the case and some of the elements in it may be optional. Yeah. I think, I think that's definitely right. And we also see, I mean, at our conference the previous year, my former colleagues would be a was on from B.A. It was on stage of the Madais. And they made a point of saying, we have a contract that enables modularity. They didn't say necessarily that we're going to implement a solution immediately that has modularity. Yeah. They clearly are enabling themselves that if even if they implemented most of the Madais stuff to start with, I don't know, I don't really understand knowledge on that, but that could be the plan. Yeah. Then over time, if there's bits of that where they see other vendors with good solutions, they can plug those in. And so I think even if you don't start with modularity, you might you might go from PSS to RSD in a in the simplest way you can. Yeah. From your current vendor to your current vendors, new solutions, but keep the option to plug new things in over time. And I think we also have to remember that a lot of these systems are modular anyway because today they are an OSD platform sitting over the top of an old res synchronizing orders and PNRs and so on. There aren't many people who are freestyling their OSD quite yet, maybe one or two. So the, you know, I think the modularity is appearing. It's a bit patchy at the moment and it's not easy to perceive because of the way that the contracts are being announced. But there are also new types of modularity appearing. So, you know, we used to tend to think in component terms, you know, I get component a from vendor one and I get component b from vendor two. But actually now we've got things like I get component a from vendor one, but the AI science that's executed within component a is either built internally or comes from another party, you know, a boutique data science house or whatever. So there are actually new types of modularity appearing where I'm buying the science from one vendor and I'm buying the transactions executing that science from another. So yes, I mean, I have high hopes for modularity, but we're all feeling our way at the moment because it hasn't been standardized. And there definitely are some real examples out there. As you said, in the WPS, there was a few examples we had in innovation on stage with their delivery solutions and that's, you know, they do delivery. So they're in any way they're implementing there almost by definition in a modular world. Yeah. I just like that. I think Bert said something important a moment ago, which is that in my mind, I have absolutely no doubt that the big vendors are building their systems in an architecturally modular manner. But will their contracts facilitate airlines being able to actually make use of that modularity and mix them that best of breed or will it be made contractually very difficult to do?
to break the core vendor's product. - And without wishing to blow any trumpets, the answer is if they get a T2RL contract, yes, because we have a huge emphasis on the ability to do that, even if you decide to buy everything from one vendor all at once at the beginning, the long-term protection of your right to have a commercially agile architecture and swap components in and out and integrate new components, both at a component level and bring in third-party science and all that kind of thing, is something that we put a lot of time and effort into in constructing our new contracts. - I think in the report as well, I mean, just to ping into some of the detail, I think, Ryead Ayers of Go Life is really a pointing case or a shining light in terms of modularity. I mean, clearly, flyer being behind the author, or the management, or with a huge significance move, but we certainly have a few vendors in the mix supporting that major deployment. We've got ink for delivery, we've got TP Connects in Viratail for NTC aggregation, cell point for payments, low T-jogging or low T, you know, I think it's involved in that as well, yeah. - Yeah, that's fine. - And it's really. - Yeah, and I think Raghu put up quite a good slide on our conference showing quite a good mix of vendors in there in terms of what they've been implementing. So the answer is yes, you can absolutely do it, but the challenges, there are some new challenges and there are some of the old familiar ones as well. - Yeah, one of the challenges that I guess has been with us since systems first started to be deployed, but it's especially acute now that we've got this modularity goal is the need for standards about how the different modules are gonna fit together. And something that worried me quite a lot at WPS was when IAATA said they don't expect to have a full set of standards until 2028. That seems to me to be far too late and if the industry as represented by IAATA doesn't come up with standards on a much more rapid timescale than that, then the dominant vendors are gonna set the standards and that'll be the end of it. - Yeah, but I think that's always been the case to some degree. It's very difficult to pre-write every single standard and hope that vendors adopt them because it's very difficult for organizations like IAATA to move faster than the vendor community. And I think that the IAATA date is probably just an acknowledgement that some of these standards are going to come from practical real world implementations that have been worked out between vendors and their customers. Now that's not neat or tidy in its far from ideal, but I think it's just a reflection of reality. I think if we waited for a complete set of standards before we started implementing, we'd never get started at all. And I think it's more about understanding the risks and challenges that that presents and working out how we can mitigate them rather than sort of falling back on wishful thinking. - Yeah, and that's fair enough. But I must say I'm hugely disappointed that as an industry, we don't yet have a standard even for something as fundamental as how do you create an order from an offer? - Yeah. - That standard does not exist. - Yeah. I mean, IAATA have members and those members, their priority of those members ought to be reflected in what IAATA are doing. So either IAATA are not meeting the priorities of their members or the members haven't been clamoring for this standard to be established or hasn't been exactly hasn't been well communicated, it's difficult to know. - And they are in a difficult place. And I think we absolutely should acknowledge that. If we look back to, if you like the last orgy of new technology that hit AELI distribution, which was the launch of edifact 30, 35 years ago, at that time, most of the big airlines who were in the IAATA working groups had extensive capabilities themselves. Since that time, many of them have outsourced most of their technology capabilities. And unless the vendor community is able and willing and allowed to step up into the standard setting arena, it's gonna be more difficult than it should be. - Yeah, I think some of the vendors have got involved, haven't they? But it's an interesting, it's a slightly different dynamic because they've got their own commercial interests and they don't vote in the same way. So it needs to be quite collaborative with airlines, IAATA vendors figuring out how to kind of make this work together, which is probably more complex. - It really is complex. And the last thing I would ever want to do is say, "Oh my God, these people are so slow, "or so stupid, or whatever." It's not that at all. It is a complicated problem. And people are doing their best to solve it. But at the same time, I really wish we could be moving faster. - Yeah. - One thing that is moving fast, and again, it came up somewhat in our conference, and again, probably even a little more in the IAATA WPS. I wasn't at the World Airlines Festival, which I think you were, but so maybe you'd discuss there as well. Is the whole subject of AI. And the subject of AI goes way beyond just our industry, our little parochial concerns. It's driving the entirety of the stock markets, gains in recent times, and vast amounts of money being poured into AI. We published a week or so ago a paper on just some thoughts about the approach of agentic AI to our industry. And I think the conclusion in some would say, typical consultant style was, it's probably too early to say, what many of the results are gonna be, but whatever they are, they need some thinking about. - Yeah, I think that's fair. And it's more, who's not talking about AI than who is talking about AI? I mean, it's every pub and corner shop seems to be a conversation going on about AI in some form. And a lot of it now turning to conversations about concern for the alleged AI bubble and so on. And there is a huge amount going on in the industry, particularly I think with a focus on agentic AI and what that might mean for some of the business models, what that might mean for shopping and booking activity, and so on. And to a degree, it is too early to say. But you can sort of speculate based on, this isn't the first time that new technology has been introduced into business models. And I think that typically people tend to overestimate both the importance and the impact of the technology itself. NDC was a classic example where actually, there's a lot more going on in the business side of NDC and just the traditional distribution business than the technology in and of itself wasn't as revolutionary as people believed. And it's actually only now when we start changing how we offer and where we place offer and what we place and how we price and so on, that NDC is kind of coming into its own. And I would say that the parties today who have access to content and who have access to consumer channels, whether they're direct or indirect, are likely to be most successful with agentic AI. And that's largely because AI has become so massively commoditized and democratized, the AI vendors are more or less paying people to use their products at the moment. I've read in a report recently that Microsoft is losing $20 per copilot user. So the idea that the AI technology in itself is going to be a differentiator. I don't think is true because pretty much anyone can get access to it. And so actually, the differentiator will be how smartly you implement it. And do you have a, the domain knowledge, b, access to the content, c, access to consumers, and a huge amount of consumer choice data on which to train and model agents, right? Which would suggest that if everyone has broadly the same access to technology, the people who are going to be successful are actually the people who've got access to the consumers, the content, the domain data, and so on. I, those people are more likely to build a better agent. So I think some of the talk at the moment about traditional players being suddenly disintermediated Bye.
AI are really coming from people who overestimate the importance of the technology over basic market logistics. - Yeah, one of the big questions about AI, whether it be a gen T or generative or any other kind of label you want to slap on it, is what's it going to do to look to book ratios? And there are two arguments. One says loads of software agents running around the internet, kicking off searches is going to push looked to book through the roof. The other is loads of really smart software agents formulating much better queries will actually help mitigate the rise in looked to books. - Yeah, and so both the argument you find yourself. - Both of them are true. I mean, we know that loads and loads of, let's call them software agents do drive looked to book because there are hundreds of thousands, if not millions of automated bots, heuristic scripts. - So they're in their frages. - Yes. - And they've been there forever. And every airline who runs a website is absolutely drowning in a fire hose of just polling and scraping. So we know that that is true. I think the question is, if all of the people who are scraping today move away from a kind of a basic heuristic script to an AI agent, does that push the volumes up or does it push the volumes down? A smart AI in theory, or to be able to get to the right offer for a given consumer faster than a kind of a robotic scraper. That would be my first point. I think the other point is that the whole industry today runs on caches and caching validation. I how long can I hold a piece of data for is one of the great hard problems of computer science. So if there's one thing an AI could do really well, it's manage a really, really smart and efficient cache. So if caching becomes more efficient, that should cause requests to go down a bit. So I tend to think about what are the things that would cause it to go up and what are the things that would cause it to go down. I think there may be new people who start scraping, but either they'll be more efficient at it than the current players, in which case it will push the current players out and you just get a natural replacement, or they won't be more efficient than the current players and they won't end up with a viable business. So I think there's a sort of an argument that says there could be as many downward pressures on overall volume as upward here. And I think it's only if the move to AI changes consumer demand to actually changes the way that consumers behave, that we might have really significant changes in, because what I've to bear in mind is the majority of traffic on the internet today, it's not really driven by organic real consumer demand. It's driven by bots, populating caches, trying to anticipate consumer demand. Yeah. Yeah. So Amanda, when we were researching the latest RRSD report, pretty much every vendor company that we looked at is incorporating AI into their products in some way. Would you agree with that? Can you think of anyone who isn't claiming AI's in their products? Well, maybe I could if I derived, but certainly it was almost a ubiquitous topic, I think in this report, what was quite interesting though is that everyone seems to have a slightly different take, whether they're like Excel or maybe using AI to query the order database to find commercially beneficial insights, or whether it's being used for delivery, I think innovation as well as incorporated AI into their delivery solution. Stabour I think is also doing a bit of work around pricing with AI, so I think the key message in the report is yes, everyone's doing it, but everyone's doing it differently. Yeah, and I also, I feel a bit sorry for these poor vendors, because most of them have probably only just finished ripping out the blockchain that they put in a couple years ago, which was also going to revolutionize the industry, and now they've got to start slapping in some AI. I'm going to drop the demand here soon. Yeah, when you were talking about the potential for people overestimating the impact of AI, I was reminded, I think it's one of Arthur C. Clarke's laws of something or other that says that people overestimate the short term impact of a new technology and tend to underestimate the long term impact. And I suspect that's what we're going to see. In five years time, the people will be doing stuff with Gen AI and Agentic AI, that at the moment we are only beginning to imagine. Yeah, possibly. Okay, another subject from Conference Season. And I'm very glad that we picked up on this a year ago, because it's certainly becoming very true, is the growing importance of managing payments and settlements in the commercial environment. At our conference at Engage, we had a dedicated payments track, which threw up some very interesting presentations and discussions. I Arthur, of course, combined a couple of years ago, combined the world pathogen symposium with their world financial symposium and tended to kind of cross-fertilize between the two. But I think payment has gone from being very much an administrative part of the Jigsaw, to being a strategic part of the Jigsaw. And I think we're getting a lot of people realizing that now and bringing it to the fore. Any thoughts on what we've seen over the last couple of months in the discussions of payment? I think one of the things that's notable is, historically, there's been a huge amount of fragmentation within airlines on payment. So if you wanted to talk about payment strategy holistically, it was actually quite a difficult thing to do. So on the back end, all of the acquiring would be sort of a treasury function. And then there would be a sort of an IT bit, which was dealing with the various payment processes and so on. And then there would be a commercial element to it and trying to extend customer reach. And so talking holistically, we're generally quite often involved having to have at least three different conversations. And I think what we've seen is more and more airlines bringing all of their payment accountability and responsibility and payment thinking together and looking at it much more elistically. Often they're bringing it together with distribution as well. - Yeah, yeah. - Where there are quite a lot of overlaps. We do increasingly see people who are VP of distribution and payment or something similar to that role. - Was that not your job title at one time? - That was my job title at one time. (laughing) To learn fast about payment. I knew a bit about distribution, but I had to learn fast about payment. Yes, it is definitely a theme. And also as you do NDC and offer order, you need to take a bit more accountability for how payment works in the indirect channel as well, which has its own complexities. So that's another, was perhaps one of the drivers while airlines are bringing them together. Definitely I'd seen more people with that job role. And also in the vendor space, I mean, we've seen Amadeus go quite heavily into payment over the last few years without place. And there are definitely other players that are, travel fusion has a payment product. There are a lot of different players in the distribution space that are kind of linking into the payment space as well. - Yeah. And I think there's also, payments is not just credit card transactions. I mean, there's a whole load of complexity in settlements and there are lots of other forms of payment. And settlement in the airline industry has always been, has always had this sort of extra, things like the BSP and different methods for netting off what organizations are each other. - Yeah. - And also I think if, if the ambition for airlines to become retailers of a broader set of services, particularly third party services, then issues of payment processing and settlement and so on are going to rear their head again. And if we haven't done the groundwork in advance in terms of payment processes, payment orchestration gateways, all that kind of thing, it's going to end up costing more to do that business than it would otherwise. And so I think there's certainly a lot of good groundwork and preparatory thinking being done both by airlines and vendors about, how to enable the payment and settlement end of airlines, modern airline retailing ambitions. So if we say, look, I've got an ambition to be a modern airline retailer, well then you need to be a modern trans actor in terms of payments and settlement as well. - Yeah, and have good data and understand how the transaction is flowing and all those kind of things. Yeah. - Yeah, I think your point about it not being just about payment cards is something that's been a reality in quite a few parts of the world for some time. I think about the mobile payments.
capabilities that have kind of leapfrogged in Africa where some of the things that we know and love just never happened and they've jumped straight to mobile payments. And the Latin American market where payment by quotas has been a thing as long as I can remember and what's happening in China with we pay and so on. I think perhaps the airline industry was a little slow to recognize some of this. And I think partly because the payment by card mechanism was so well established and frankly very efficient. The people were a little bit reluctant to embrace some of the new things. But I feel that's changing now. In fact I feel that's changed. Yeah, I think that the issue with alternative methods of payment is that while they're sort of nascent and maybe you're not seeing a lot of demand and it might only be 2% of your transactions, it's difficult to justify significant investment in alternative methods of payment. But I think what's happened is that again in other industries, all of these forms of payment, micro payments, micro credit, all sorts of things are driving consumer expectation of how they'll be able to pay for things. And so sooner or later airlines are just sort of waking up and saying, first of all I need to do this and secondly it's being made much much easier just to plug and play. I think the sophistication of some of the payment platforms now mean that I can turn on additional currencies, additional forms of payment in different markets. Actually I don't want to make it sound like it's literally the flick of a switch, but much more easily than ever before. It was, yeah, 10 years ago when I first had some payment responsibility in B.A. we looked at some other airlines that were doing interesting things. I remember KLM had quite a lot of forms of payment. There's some interesting, I mean, the ideal in the Netherlands is a strong platform in itself and there are some others in the some of those European markets for them. They fly a lot of interesting markets, but it was quite complex at that time to implement new forms of payment I think compared to today. So there are some airlines that have been on this for a while, maybe depending on the region you're in and the country you're in and whether that those markets are particularly exposed to this. I think all airlines are probably exposed to one special local or regional form of payment that only exists in a certain market, whether it's in storements in Latin America or other unusual cash allow or whatever. You get all of these and I think the point is that the barriers to implementing these things are coming down and so it's not the sort of massively daunting thing that it once was to implement a new form of payment. I guess we are seeing more airlines go to market for things like payment orchestration and other payment systems. It does feel like you should be if you're you should be looking at this if you're not. Yeah and that was the point I was going to make is that over the last few years we've actually seen the creation almost of a new category of service company, the payment platform payment orchestrator, which really didn't exist a decade ago and now is very important to a lot of airlines. Yeah. I mean airlines wrote their own as best they could. You know, so many airlines that I've worked with over the last 10 years had this kind of weird octopus of code that was basically switching transactions through different channels and different pathways, you know, mostly rule optimised in order to find the best transaction rate and so on. And these bits of code would start off as a fairly simple switch, maybe just spreading credit between a couple of PSPs and acquirers and over time got more and more and more complicated and now have been completely sort of productified into these really sophisticated platforms. But I think, you know, to begin with, there were probably only a handful of airlines who were operating at that level of sophistication and the vendors have had to do a huge amount of work educating the industry about what payment orchestration is and how it's different from just a gateway, for instance, that kind of thing. But I think that is now starting to land and I think that's one of the things that stimulated so much interest in payments and, you know, why we've now got a dedicated payments track at our conference is that, you know, that people have started to listen to that talk and really looking for the opportunities there now. Yeah, and I will just mention then, as you did, we have the dedicated payments track at Engage 2025 and we're just in the process of outlining the agenda and the plans for Engage 2025 and the dedicated payments track will definitely be back. We were quite pleased with the result. First time we ran it, we maybe made a few slips but on the whole it was a very valuable exercise and we'll certainly be doing it again in 2026. Yeah, and I mean, you know, we have to discover what people want to hear and how they'd like to hear it presented and so on just like everybody else and it's never too late to give us feedback. You know, we're always interested in hearing from people about what they would like to hear or see at our conference. Absolutely. And it's such an important intersection with the whole change to RSD. I mean, there are, you know, there are lots of payment experts out in the world but I think we're particularly interested in not just payment in its own right but how it's kind of interact with the change that airlines are making to their sort of broader technology stack is, so in particular relevant to us, I think. Okay, moving on in the last few minutes, I just want to talk about one or two of the technology vendors who are doing interesting things in the move to RSD. I'm actually going to leave aside the two 800 pound gorillas, I'm a dursing saver, I think they don't have any difficulty in getting their news out to the market. Let's talk a little bit about Accelia who I know Amanda, you know very well. They're doing a lot of stuff and that I think they are apart from obviously building and selling products. They're also trying to move the industry along in facilitating the adoption and facilitating the ways that different members of the distribution chain can work together. And, you know, I think that came out at both our conference and the WPS. Ian, thank you. Yes, I mean, we saw BCD join the past track, I think it's called. GBT, saver, having players across the chain, I think is generally we would all probably say is a good thing. And, you know, when you've got players at that kind of scale, hopefully we will see some kind of meaningful change. We know that corporate in particular has been the most challenging place to kind of get NDC working. So, yeah, I think we're sort of hopeful and supportive of the objective. Yep. Okay. And then our friends, one of our two sets of friends in Istanbul, hit it. Whilst everybody was maybe looking in the other direction, hit it quietly implemented an RST solution for a substantial European airline. And first anyone heard of it was when they said we've already done 10 million bookings. Yeah. Yeah. And entirely by design, I'm sure. I mean, you know, they will have been in stealth mode. I mean, you know, for, you know, Pegasus, we're already their largest, certainly their largest airline customer on the old crane platform. Yep. And so an obvious partner for them to develop an RST solution with. And I think this will be a really interesting space to watch, you know, is, you know, how, how, how long will it take until the oxygen platform is sort of self-sufficient and doesn't require crane underneath it, as it were. And, you know, I think everyone's, there's always a question about how, you know, how, how, fully, how finished is it? You know, is it, does it have a new DCS, or is it still an old style of DCS? And to be fair, that is a question we ask about any of the new solutions, including those from the A-Tum group, or others. Yeah. Yeah. The other set of friends in Istanbul I refer to is actually Turkish Airlines. Yeah. Somewhat going against the grain of industry trends for the last couple of decades, really, Turkish has announced that it wants to become a technology vendor to other airlines as well as it's done. It's IT providing for the host airline. And of course, very many of today's technology providers started off that way. They started off as the IT function of a substantial and some still I mean, Lufthansa systems is still, you know, testament to, you know, airlines can do this if they need to. And I think also because Turkish has spent many years really investing in its own technology, they're one of the few.
carriers who still have their own in-house mainframe PSS in the form of Troya, but they also you know innovate and build their own technology and I'm sure there's enormous pressure to somehow monetize some of that investment as well. So Turkish technology has been born and obviously we wish them all the best. Yeah and you know I had a quite a long conversation with WPS and apparently they've got a hundred people allocated to Turkish technology to start with so it's certainly something they're taking seriously and obviously there will be airlines who will be very interested to talk to them I'm sure. Yeah I think so I mean it's always been a slightly sort of interesting conundrum around would you buy technology from another airline you know would you buy technology from another airline who were your competitor that kind of thing but historically as you said in it's it's been fairly common for airlines either individually or as groups to start technology. Very much so in the mid-90s when I was when I was at British Airway Speedwing and responsible for the multi-host Red System we put out we had both British Midland and Ryanair hosted in the platform and you know we we seem to rub along. Yeah and another company we've talked to recently was tick systems who have also quietly developed and offers an order's base system and offering it to the market in some ways it's easier I think for those vendors who've largely worked with low-cost airlines and airlines with simple business models to make transition because they don't have quite as much legacy baggage that they've got to accommodate and and they're probably working with a slightly or they're starting with a slightly younger generation of technology even in their existing systems. I think that's right and I also think it shows that you don't have to be a sort of a massive BM off of an organization that actually if you've got that domain knowledge and expertise you can implement very good modular solutions quite quickly and efficiently. I mean we were looking at sort of tick solutions and you know they've got a very capable ticketing server which will run as a completely standalone component you know alongside PSS is that that's our ticketless. So you know I think that you know for people who understand how some of these legacy technologies work actually implementing modern modular versions of them is is relatively straightforward and what the industry needs at the moment is are these kind of glue and compatibility and translation layers you know we've talked about how important transition is going to be over and above just just the technology itself and so I think you know solution providers who understand how to how to translate to and from modern and legacy standards and can quickly produce you know modular components I think there's definitely room for those kinds of people in the market. Well when we were talking to those guys I mean clearly their experience and their knowledge and so forth really shone out you know that they were a really great team. I also admired them for their sense of humor. I think they've known there are the platform OOPS. So they're a place for them for having a wink as well as delivering great work. Okay we could probably carry on this conversation for a long time because there is a lot happening in the industry and in the market at the moment but we don't want to run on too much beyond people's typical drive to work which is where I understand many people listen to this podcast. So I think we'll we'll wrap it up for now. We will be back quite soon with another podcast where we're going to take a deeper dive into the market for distribution aggregation NDC and other forms of API that people are aggregating outside some of the traditional channels and it's a very interesting market. We're also having a great deal of fun or a mander is trying to get together some credible numbers on that market which are a little bit hard to come by but we'll talk about that much more next time. For now I will just thank the three guests in the studio I'd like to thank Ian and Bert and especially Amanda and welcome to T2RL Talks Amanda and I'd like to thank you for listening and I look forward to talking to you again in the next edition of T2RL Talks. Thanks Ian.
Podcast Summary
Key Points:
The airline industry is fully committed to transitioning to OOSD (Offer-Order-Settle-Deliver) and modern retailing, with significant momentum from implementations, contracts, and RFPs.
NDC (New Distribution Capability) is now seen as a foundational building block for OOSD, driven by goals like continuous pricing, rather than just a distribution API.
Over 90 airlines have NDC agreements with one or more GDSs, showing widespread adoption.
Modularity in OOSD systems is increasingly achievable, but challenges remain around integration, standardization, and contractual flexibility to mix components from different vendors.
Industry standards for OOSD, such as creating an order from an offer, are not expected from IATA until 2028, risking vendor-driven defaults.
AI is a major topic, with vendors incorporating it into products, but its impact on look-to-book ratios and business models is uncertain, with both upward and downward pressures possible.
Access to consumer data, content, and domain knowledge, not just AI technology, will be key differentiators for success.
Summary:
The airline industry has moved past questioning the transition to OOSD (Offer-Order-Settle-Deliver) and is now actively implementing it, with strong momentum from contracts and RFPs. NDC is gaining traction as a precursor to full retailing, often driven by continuous pricing goals, with over 90 airlines now having NDC agreements with GDSs. Modularity is a key aspiration, allowing airlines to mix components from different vendors, but challenges persist, including integration complexity and contractual barriers.
IATA’s slow progress on standards, with a full set not expected until 2028, risks allowing dominant vendors to set de facto norms, though some standards are emerging from real-world implementations. AI is a pervasive topic, with vendors embedding it into products, but its effect on look-to-book ratios remains debated—while AI agents could increase search volumes, smarter caching and more efficient queries might mitigate this. Crucially, success with AI will depend on access to consumer data, content, and domain knowledge, not just the technology itself, as AI becomes commoditized.
Overall, the industry is navigating a complex shift toward modern retailing, balancing technological innovation with practical challenges in standardization and integration.
FAQs
The industry has definitely started on the transition towards OOSD, with enough momentum from implementations, contracts, and RFPs that the question of whether it will happen no longer exists.
Airlines are embracing NDC, often as a precursor to full modern retailing, with many focusing on continuous pricing and content distribution rather than just distribution disruption.
Yes, modularity is more achievable now than historically, with examples like Riyadh Air using multiple vendors. However, challenges include integration risks and contractual flexibility, which T2RL contracts aim to address.
IATA's 2028 target reflects the complexity of pre-writing standards and the need for real-world implementations. Delays risk dominant vendors setting standards, but starting implementation now with risk mitigation is seen as practical.
AI is widely discussed, with a focus on agentic AI for shopping and booking. Success depends on access to content, consumers, and domain data, not just the technology, as AI is commoditized.
AI could both increase look-to-book ratios via software agents and decrease them through smarter caching and efficient queries. The net effect may be balanced unless consumer behavior changes significantly.
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