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Amadeus Evolves Ground-Breaking Airline Pricing Approach

Amadeus has announced its 2005 pricing for distribution services for airlines. Effective 1 January 2005, the company will roll-out the second phase of its industry-leading value-based pricing model, which recognises airlines’ diverse commercial strategies and the different benefits that the GDS channel brings to airlines today.The two key elements of Amadeus’ pricing for 2005 are:

Development of the segmented booking fee structure, further differentiating the fee charged for different types of bookings, depending on the value each brings to an airline.

Additional opportunities for the distribution of airlines’ low fare inventory.

Commenting on the 2005 pricing model, David Jones, Amadeus’ Executive Vice President, Commercial, says: “It is a year now since we made the first steps in our value-based pricing approach - moving away from a flat fee for all. The philosophy behind this model has been widely accepted by our airline customers. Indeed, we will see in 2005 that an Amadeus booking fee can range from $4.90 to as low as $2.67 - in line with the value delivered to the airline by a booking.

“The airlines tell us that the global distribution system (GDS) continues to bring them important value - and in some areas of their business, unique business benefit,” adds Jones. “They say the GDS is the most effective way to deliver brand recognition and drive sales outside their home markets. It is the channel that facilitates the management of high yield and complex sales.”