OOSD Status Report May 2026

[Music] Hello and welcome to T2RL Talks and today we're going to be talking about the slow but steady progress the airline industry is making towards modern retailing or OOSD as we usually call it within T2RL. We published our most recent report on progress towards OOSD just two weeks ago at the time of recording maybe a little more than that by the time you hear this. And with me in the studio to talk about it I have the author of the report Amanda Campbell and I also have Ian Luck who is head of T2RL's distribution practice. So I am Ander Haien. Hello, what to see you again? Yes, for anyone who doesn't know I was away for a few weeks and so I'm catching up rapidly on what I missed. One thing that wasn't in the report but I think I'd like to bring it up right up front and center is Ria Deir has finally gone live for sales and has announced today of starting full flights to London. It's actually been operating daily flights for a while but they've been very much in the spirit of just keeping it slot open. But these are going to be real flights really sold through its modern retailing platform as provided by flyer and saber and in innovation and others. And I think this is a pretty significant moment in the development of OOSD. I think I'm going to be able to do a lot of things with OOSD. I think I'm going to be able to offer all the sets of deliveries going to be interline working with partners. I think I'm going to be able to offer all the sets of deliveries associated products and services and stocks. But there's no doubt that it is the big story right now across many, many industries. - Yeah, and interesting to see, I mean AI comes in a million different flavors in use cases. Lots of airlines are using it and thinking about it for back office processes and things like that. And so indeed, a travel sellers and travel agencies, TMCs, et cetera. It's a little unclear, I think, still we're seeing some early steps of kind of conversational booking technology. I think is what Skylinks described as using or a GenTik AI booking capability. It still seems quite early, but again, it's something that a lot of people are investing in effort in trying to establish. - Thanks for me. It's all about kind of automating kind of processes that already exist, isn't it? It's about making things a little bit faster and maybe less resource intensive. I haven't actually seen anything that's blown my socks off if you know what I mean. It's more like that they've put in either natural language processing or something that helps me communicate with the bot better. But I haven't actually seen anything that I've got. Oh my goodness, AI is going to take over the world. And I don't know if that's because we just airlines and the travel industry is a little bit behind what other industries are doing or whether the technology really isn't there yet. I mean, you hear about AI technology being able to like create and innovate on itself without necessarily being taught how to behave. I've been through as few courses and so forth over the weekend just learning a little bit more about it. And certainly what I saw and heard about on stage is not what we're seeing in development today. So just a personal note for myself is to figure out what that disconnect is all about. Well, I mean, I would put a question to you then. Is have your socks been disturbed by AI innovation in any other industry or any other vertical? Yeah, not so much vertical. As in, I haven't seen any other products that are really not my socks off. But I have heard of hardcore examples whereby AI acting on its, I don't want to say own accord, but certainly with very limited human intervention has done things like spun up businesses that has created a GTM, go to market strategy has started to execute that strategy. So yeah, maybe you're right. I mean, maybe it's not that we are behind and airline and travel. Maybe it's just, yeah, the world isn't there at the moment, but from what I hear, it's certainly quite different church what we're seeing on the ground today. Okay, I mean, one of the, one company that is very much attaching itself to the AI wave, if you like, is Saber. And Saber has announced a number of things, just recently they've announced a three way partnership with PayPal and mine trip to create an AI planning and booking tool. I think that is as much about signaling to the market but Saber believes AI is definitely a critical part of its future more than anything very concrete yet. And I know Lee and you said you've had a look at this collaboration and so far at least it's baby steps. Yeah, I think a lot of this stuff is piloting and testing. And who knows, it may work for some users more than others. It may work for some people who are maybe slightly younger than the three of us, who knows. So yeah, I think a lot of it is piloting and testing and I think it makes sense to put some things live and see how they work. You can change these things quickly. You've got to do that type of thing. I guess Saber's also using a lot of AI or at least, that's what we understand, developing in their technology solutions for airlines. So, you know, Saber is like Amadea on both sides of the house for airlines. They provide a lot of technology to a set of airlines as well as providing kind of distribution capability where they will do work with agencies, their parties and others. So I'm sure we'll see, we'll see use cases for AI in both. I think the booking payment and trip stuff, trip management stuff, which is what they talk about with this solution is coming. You can make it work today. I haven't yet seen that it's changing everything, but there's so much potential. I don't think anybody really knows exactly where it's going to go yet. So we should be thinking about it and preparing for it, ignoring it is not a good idea if you're a airline distributional technology person, but it doesn't mean we know exactly where it's going to go yet either. - Yeah. In and I had a podcast there the other day, we recorded it with surgeon from Air Serbia. And the way he was thinking about AI was quite interesting. He was looking at it in terms of distribution and he was thinking that in our neck are the woods that we would be treating AI quite like metasurge in the very near future. And that's where he saw the immediate disruption taking place, which I thought was quite interesting. - I mean, there's an argument that it's kind of super souped up metasurge, you know, much beyond what we think of today. And it is if you talk to your agent and ask it to find you solutions, potentially book them for you, then it will be searching in as many different places as it can and a little bit like in the way metasurge has tried to, you know, kind of search the whole internet to find flight options and solutions. And so it could be asking suppliers directly, could be asking OTAs, could be asking anybody that can provide airline content, you know, what's the best solution, the best price, the best offer for this kind of need that my human owner has or whatever the right word is. - I'm not sure. - Yeah, I mean, I think for me an important question is where AI agents surface and they probably will because there's a lot of momentum behind bringing this technology to use. Are they going to just become another layer in the channel and, you know, another link in the chain, or are they actually gonna displace any of the existing players? And I don't think that's clear yet at all. And as you say, I think we've just got to keep on monitoring what's happening in the industry and in the technology and being flexible and being prepared to adopt things that are proven to be successful. - Yes, I think that's right. And every player in the chain that we think about airlines, OTAs, MetaSertGenjins, Google, who, you know, a lot of search queries come to airlines by natural search today, other paid search, however they get there. Everybody's thinking about what AI will mean for them, how they can use it, how it can help them become, you know, a more important player in the chain and some people might win and lose out of it. I don't think, I think the will be changes. Exactly how it all shakes out is a big question. So, you know, we would definitely encourage everybody, all our airline customers to be at least kind of thinking and monitoring carefully. - Yeah, and it's not just technology. That's something that we shouldn't lose sight of. The chain, if we're gonna call it that, the distribution chain that starts from sort of ideation and goes through searching and into booking and so on and so on, there are some big financial flows between the players in those. And today, the big winner is Google. You know, Google is at the top of the funnel and it's making money from lots of people through the chain. And I mean, I would imagine. - Particularly in the hotel space, I mean, somewhat in the airline space as well. In the hotel space, they are hugely, you know, they make a lot of the margin on hotels. - That's right. - Even though Expedia and booking, you know, often people book through them, actually a lot of the money ends up in Pay to Google. - Yeah, so if Agentic AI comes along and starts to erode that flow for Google, I think we might see some interesting responses because, you know, that's its core business. And it doesn't want to be usurped, I think. - No, I mean, clearly Google has it say AI, Gemini option and other things. And it may replace itself to some extent. Who knows, or will some of the competitors take some of that space? It's interesting. - Yeah, I mean, one of the things that is happening very much in AI over the last few months, really, it's become prominent. And I note in our report, We call out that TP Connects is just-- added an MCP layer, a model context protocol layer, to its service. And that is one of the things that are going to be really important if AI is truly going to become an integrated part of the distribution chain and the booking and payments chain as well. It's really important to note that MCP isn't the only game in town when it comes to protocols for gluing AI into your environment. The best explanation, the best short explanation I heard is that MCP is the tool to use to allow agents access to data, to databases, to transaction engines and so on. But if you want agents to talk to other agents, you need a different tool set. And the leading contender there is actually from Google, the agent to agent protocol. And you know, things are moving so rapidly in that area. But it's kind of hard for simple souls like us to keep up. But that's kind of our job. We try to do that. We try to keep up. Yes. And it's not self-dubass and that regard Amanda. It's clearly a changing environment. It's clearly different from peting standards protocols. There's people who have got some of their own commercial interests partly. I think a lot of it's PR as well. I mean, I have a marketing background. You've got to have your share of voice. You've got to be front of mind. I don't know. I have a guest that if you had shares on your IPO and you had shares on the stock market, if you didn't sort of feed their ways with something AI related every few weeks, maybe your share price would drop. I mean, these things are very much all interconnected. Yes. Oh, and there are definitely examples of that. There are definitely examples of companies whose business is not even remotely technologically related, suddenly announcing that, oh, we're now an AI business. And the share price goes up. It's the, yeah, did anyone say the word bubble? There are some of the signs of a bubble. I want to move on. I want to move on and talk about something that is absolutely not fully dependent on AI. And that's an announcement from DoHOP. Some of the big challenges in modern retailing OST that has still not been solved, despite a decade now of trying, is how to effectively manage inter-ion relationships. We've got IATA's developments of the SIRCIA, the new inter-ion agreement. But in terms of the actual nuts and bolts of how airlines will exchange offers and orders and create inter-ion itineraries and so on, we're still a long way from solving that completely. And DoHOP is one of the companies that has actually achieved quite a lot, mostly around low-cost carriers. And their products have been referred to as virtual inter-ioning and there are so many different flavors of virtual inter-ioning. But that's quite well established. It's been established for two or three years at least. The thing that I caught my attention was that DoHOP has now announced something called BagConnect because one of the big challenges of virtual inter-ioning or non-consensual inter-ioning we might call it as being getting the baggage to connect. And it is a problem, especially when you've got international transfers and if you're doing self-connecting you've got to actually come out through immigration and customer check your bag and recheck it and absolutely painful. Yes, absolutely right. But DoHOP says that they've now got a product called BagConnect that is going to solve that problem. I studied the announcements very carefully and I've got to confess I don't understand fully how it works yet. I don't understand what the business model is. I don't understand who pays for the service. I think all those things are to become clear. But if it can do the things that DoHOP says it can do, I think it is an important step forward especially for that low cost carrier hybrid sector of the market. Yeah, I think that's absolutely right. I mean, you talk to LCCs and hybrids who've started down the path of the traditional way of doing interlining and then looked at the DoHOP version and it's so much simpler for them to stick with the DoHOP type version. DoHOP's not the only vendor that does this we should say. Absolutely not. But yes, that's right, whereas the baggage part has always been one of the most difficult issues. There was always the issue of, well, what happens if my flight's late? Do I get on the next flight? But DoHOP and I think some others have sort of dealt with that via insurance products. You know, effectively the customer does pay a fee when they beyond the price of the two flights that partly covers the service that DoHOP provides and partly covers some insurance so that if they miss the connection, there's some money to buy them a new flight. So that part's been, but the baggage part has been probably the hardest thing to fix, I think. Yeah, and yet the infrastructure has been there for a long time. It's probably 15 years ago, I remember getting a flight from Australia back to Europe and I flew jet star on the first leg up to Bangkok or Singapore and connected to our friends. Two airlines that have absolutely no agreements between them, but the industry's baggage infrastructure did actually allow me to check my bag through from jet star to our friends even sort of 15 years ago. So the infrastructure's there. It's a matter, I think, of marshalling it and organising it and presenting it in such a way that people can consume it. Yeah, I think some airports were better at it than other some airports that really made a focus on this as being, they wanted to promote connections between different carriers so they focused on it. Whereas I guess where DoHOP is trying to get to with some of its airlines is to make it more usable broadly. It's very interesting, as you say, the sort of new interlining that potentially comes with offer or a settle deliver is still in the very early pilot stages. As far as, you know, we've seen some pilots between different airlines who are part of the same group, but we have not seen a lot of that yet. And the NDC interline, in many cases, the airlines that offer it, it's all legacy interline underneath. Well, that's right. It's sort of out of the back entrance, really. The front end is NDC to the seller and then out the back, they're doing traditional interline. And that can work, but it doesn't give you the new interline solution for the future. It's just a very interesting interline. It works. It stops the work being gummed up, but it's not really opening the door to some of the benefits that airlines are expecting to see from a modern retelling. Because I think it's a T-SWRL Engage, which is coming up this year in September. I think we have a very interesting topic for a panel. And it's, are we offer obsessed? And you know, I think that because offers are the key revenue driver for airlines and that is the big business case for transformation, we do get to myopic on that topic. And yeah, probably there is a lot of innovation happening further down the track that probably need a little bit more discussion and highlighting and celebrating and thinking about. So yeah. Yeah, I mean, certainly, and I'm so happy you raised a subject of T-SWRL Engage because I was definitely intending to do that. Registration is now open for T-SWRL Engage 2026, which will be happening in London. The around the 20th of September. And we very much would like to see lots of airlines in particular coming along and continuing and developing this conversation because there's still, I think, quite a lot of assumptions and quite a lot of misunderstanding about the nature of the move towards modern retelling. And one of the things that happens to have taken place earlier today, we had a meeting with a group of travel sellers. And I think if there's one sentiment that the travel sellers have, it's that they are frustrated at not being involved in the conversations at an early enough stage and actually having the airlines just throw something over the wall at them. And based on the conversation we had today with a group of travel sellers, there's a lot of really smart people. in those organizations and really smart thinking available, which would certainly help develop modern retailing and, you know, circling back to T-Triangle Engage, we will have some of those smart people at T-Triangle Engage looking to have conversations with the airlines about how to move forward with this to everyone's benefit. Yes, absolutely. Now it was a good conversation with the cove sellers are not kind of poor customer set of ours, but we try to make sure we talk to them regularly because they are a critical part of the kind of overall airline distribution platform. And, you know, we need to make sure that most of the airlines we work with still have a significant amount of indirect sales and it's important to make sure we think about that. And there are forums where, you know, we note things like accelerators fast track, we know that I/O are in bike travel sellers to some of their events, but it still feels like, and from what we hear, you know, there's more to do to try and make sure that when airlines are thinking about technology changes, they're kind of trying to bring that view in and, you know, make sure that they kind of try to make sure their solutions are going to work in all the channels, but they operate not just their direct channels. That's right. I mean, we, in the podcast that Amanda was referring to that we did research and from Serbia, you know, we highlighted that airlines are still doing on average across the whole world about half of all their business in indirect channels. And so there are partners involved in those channels who really have intelligence and experience that they can bring to bear on helping airlines improve their capabilities. Yeah, that's absolutely right. And we will try to push those conversations forward as much as we can in our engagements and our conference. And anywhere else, we'll certainly try to do our bit. And we will continue to track the market. Our offer order settled deliver report is something that we aim to produce on a quarterly basis. Occasionally, we slip my week or so, but on the whole, it's a quarterly report. And I think that's probably about the right cadence because there's a lot happening. You can't afford to take your eyes off it for too long. In this conversation, we've pulled out a few examples and there are many more in the report. So if you have a subscription to ttoirel.net, I would encourage you to download the report and have a good look at it. And if you don't have a subscription to ttoirel.net, why on earth not? And if you want to continue listening to us, what for on, please join us for the next edition of ttoirel talks. And I have a slight challenge here because these podcasts are not always necessarily published in the same order that we record them. But the next one we're due to record is about the market for revenue management systems in airlines. So join us for that one and join us for future ones. But in the meantime, I'd like to thank Amanda and Earn. And as always, thank you for listening and look forward to joining you next time on ttoirel talks.