Sabre Secrets

3rd Feb 2002

Twelve months following the launch of the Sabre.Res online booking engines for travel agents, Sabre can boast nearly 2000 customers worldwide. Sabre leads the field in terms of technological and product innovation and in an exclusive interview, Jeff Harmon, SVP of Sabre Online Travel Solutions tells us how.

”..being the market leader isn`t only about sheer size -it`s about taking the lead in terms of technological innovation..”
1. How long have you worked with Sabre for?

I joined Sabre in 1996 just before we became an independently traded company.  I ran the Distributed Computing division as part of our outsourcing business for two years before moving to the Travel Distribution and Marketing business unit, leading product marketing for distributed products, and eventually building Sabre`s Online Travel Solutions division.

2. Can you tell me about your employment history?

I began my career as a software developer for the computer hardware and software industries in the late 70s and early 80s.  I joined United Airlines as part of the Apollo Systems Planning group and ran software development groups for several Galileo travel products.  In the mid 90s I headed Interactive Travel Technology for American Express Travel Group before joining Sabre.


3. What were the aims of the company when it was set up?

Sabre`s Online Travel Solutions Division is a relatively recent addition to the wider Sabre company.  The division develops, customises and hosts e-commerce products for travel agencies.

Its formation is the result of the acquisition by Sabre in August 2000 of Gradient, the Dublin-based travel e-commerce specialist. Gradient`s multi-lingual, multi-currency technology enhanced Sabre`s ability to offer full e-commerce solutions to travel agencies in markets outside North America, and formed the basis of the Sabre .Res suite of online booking engines for travel agents. 

While these products have been marketed under the Sabre brand in the United States, the Gradient name was used in Europe until we recently announced that the Sabre brand would replace the Gradient brand in Europe, as well.

4. Have these been achieved?

The Sabre. Res suite of online booking engines for travel agents was launched only 12 months ago and we now have nearly 2000 customers around the world, so I`d say we were making good progress.

5. What makes Sabre the leading provider of technology, distribution and marketing services for the travel industry?

Sabre is the largest global distribution system worldwide, as measured by the number of airline bookings made through the Sabre system - we have some 40 percent of the global market share.  But being the market leader isn`t only about sheer size -it`s about taking the lead in terms of technological innovation.  Sabre was the first company, for instance, to develop and market e-commerce solutions for travel agencies -helping agents to compete in the online market against such names as Travelocity, Expedia, ebookers, Orbitz, Opodo and the multitude of low-cost carriers and regular airline websites.  Even today we have the widest range of such tools -enabling agents to pick and choose what features they require, and decide how much they are prepared to spend to develop an online presence.

Being the leader is also about being first to market with tools and products to help travel agents and travel providers alike market themselves, their products and their services more efficiently and effectively, while all the time helping them to save costs and manage their businesses. These tools and products are too numerous to mention here, but we define ourselves not only as a technology partner for the travel industry, but as a marketing partner too. 

It`s a crowded market out there and our mission is to help travel agents and travel providers differentiate their offering as much as possible -putting them ahead of the competition next door.  It is this kind of thinking that defines leadership.

6. Who is your main market globally?

We don`t distinguish -all our markets are important for us.  But the Europe, Middle East and Africa (EMEA) region is the only part of the world where Sabre doesn`t have the greatest market share, so this is a very important growth area for us.  We are, however, continually gaining market share in this region and do anticipate taking a leadership position here as well.

7. You obviously suffered a substantial loss (as projected) in the fourth quarter. Do you have any predictions for the coming year?

We believe the global travel industry will demonstrate gradual recovery during the course of the year, and that total 2002 global booking levels will be down about seven percent year over year.  We project that Sabre`s 2002 revenues will grow in the range of one to five percent, year over year.  These are current projections and may well be revised at various times during the year.

8. How do you think that effects of September the 11th have touched the online arena -(booking & services)?

The online and offline arenas were both affected similarly at the outset, and both are currently in the process of recovering from the disastrous events that took place at the end of last year.  Recovery in the online arena is particularly encouraging, and I put this down to the fact that people are prepared to travel again but want to be much more in control of the booking process.  They are now aware that there are a wide range of bargains and travel options open to them at the moment, and they want to explore all these options themselves.

9. You stress the importance of agencies establishing and providing an online booking presence on the Internet during trying times - would you say that this applies to the travel sector generally?

Yes -during such times, any organisation involved in selling or promoting any kind of travel needs to do whatever it can to get business from whatever channels it can.  The opportunity cost of locking yourself out of any channel of travel distribution is particularly high in times such as these.  This is why Sabre has developed Internet solutions not only for agents, but for travel providers as well.  We power some of the leading airline websites around the world, as well as many of the leading online travel sites.  This is why we refer to Sabre as a marketing partner as well as a technology provider. 

10. What is Sabre`s relationship with Opodo?

Opodo competes with many of Sabre`s travel agency customers -both `traditional` agents and Internet travel agents like Travelocity and ebookers.  We are therefore doing everything we can to help our customers compete strongly in reply -which is why I have been urging traditional travel agents to establish an online presence of their own as quickly and as thoroughly as they can.

We will be watching Opodo very carefully to ensure that it operates under the guidelines approved by the European Commission.  We are also one of many organisations that are lobbying the Commission to rule that airlines should have to make fares available to all travel agents on an equal basis -and that they should not be allowed to indulge in anti-competitive practices by making fares available exclusively to a single travel agent of their own creation.

11. How better or different is Opodo to Orbitz?

It`s the same concept, but too early to tell any real difference.

12. How do you see Opodo`s development in the UK market?

It is very early on in proceedings and they have a long way to go to make up ground against the likes of, Expedia and ebookers.  But I am sure that Opodo will become a significant force in the UK travel industry.

13. In your statement on launch, you mentioned that “`traditional` travel agents have to develop an online presence in order to avoid losing business to the worldwide web”. How do you see this development happening? (Obviously the airline and hotel websites are attracting the online sales reaching the consumers directly.)

If a `traditional` travel agent`s customer `defects`to an online travel site, it is normally because the online channel offers something in terms of ease and convenience for the customer.  In many cases it has nothing to do with price, because many `traditional` travel agents, especially the larger ones, have negotiated their own very favourable rates with travel providers. The traditional agent has to offer that same element of ease and convenience by establishing its own online booking site, and ensuring that its negotiated rates are available online as well as in the shop.

14. Can you discuss any future developments for Sabre?

Travel agents and travel providers alike can expect to see Sabre continue to lead the field in terms of technological and product innovation. We will be rolling out additional tools, products and services throughout the year that will help our customers compete strongly in a crowded, competitive market by differentiating their service and adding value to the end traveller.



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