, the travel website with the most low fares, today announced implementation of its breakthrough Supplier Link technology with American Airlines
, making Orbitz the first Internet company to replace all intermediary functionality in order to book tickets directly with airline reservation systems.
Three more U.S. carriers, including US Airways and two others to be announced later this year, are expected to have Supplier Links complete by year-end, which will result in significant cost savings by enabling them to avoid Global Distribution System (GDS) fees. Orbitz has also signed agreements for Supplier Links with seven other carriers.
“Orbitz was founded to be a low cost distribution channel for travel purchasing, and as a result, has been able to offer consumers access to lower-priced fares,” said Jeff Katz
, President and Chief Executive Officer of Orbitz. “The move to a Supplier Link with American and other airlines is another step toward reducing supplier costs in travel distribution and decreasing, ultimately, the fares that consumers pay for their tickets.”
By launching a Supplier Link with Orbitz, American Airlines is expected to save up to 77% on every ticket booked through Orbitz.com. Industry experts have estimated potential industry savings of $1 billion and up on distribution costs through more streamlined and efficient airline ticketing systems like Orbitz` Supplier Link.
The seven other airlines that signed up to build Supplier Links with Orbitz include Alaska Airlines, America West Airlines, Delta Airlines, Hawaiian Airlines, Midwest Express Airlines, National Airlines and United Airlines.
“American is pleased to be the first to implement Supplier Link with Orbitz,” said Craig Kreeger, Vice President - Passenger Sales, for American Airlines. “We are committed to developing long-term, lower cost ways to sell our product, and Orbitz` Supplier Link is a major step in accomplishing that goal.”
Orbitz` Supplier Link technology consists of sophisticated network connections that link Orbitz` powerful search engine directly to a supplier`s individual reservation host system. Supplier Link was developed using the latest techniques and technology in hardware, networking and distributed object computing. Orbitz leverages easily available commodity hardware and a horizontally scalable application architecture to create a system that is highly efficient, cost effective and optimized to handle large volumes of traffic.
“Orbitz set out to build a technology that had never been created before, and the biggest challenge was to ensure it would connect with any supplier`s host system,” said Alex Zoghlin, Chief Technology Officer of Orbitz. “Launching Supplier Link with a major carrier like American Airlines required a great deal of time and skill, and Orbitz achieved this only one year after its launch.”
To date, the prevailing model for airline ticketing has been for a consumer to initiate a transaction using a travel agency, which then connects through a GDS to an airline`s reservation system to book a ticket. In this process, the GDS charges the airline a fee for each segment (for example, a round-trip itinerary connecting through a hub would involve four segments). In the Supplier Link model, the airlines pay Orbitz a flat fee for each ticket, with no additional fees for segments, rebooking or cancellations.
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