Tech revolution in travel breaks through competitive barriers

Online travel and the technology that powers travel distribution have revolutionised the European travel industry, maintaining strong growth despite tough economic conditions, according to a study by industry authority PhoCusWright.
The report commissioned by ETTSA (European Technology & Travel Services Association) shows how independent travel distribution stimulated pricing transparency and eased consumer access to travel product and pricing information for airfares, hotel rooms, and other travel products.
"Technology unleashed a revolution in travel distribution, spawning innovation in retailing and commercial models and breaking down the barriers to competition. The study reveals the scope of that transformation in Europe," says Tom Parker, Secretary General of ETTSA, whose members include both online travel agents (OTAs) and global distribution systems (GDSs).
"Our industry, with the creative use of technology, has delivered dramatic improvements in travel research and shopping for the benefit of travel retailers and consumers," Parker states. "The future is ever brighter if we can defend competition."
The study shows that independent travel distribution provides substantial high-quality employment across Europe. GDSs employ about 6,000 people in Europe, and OTAs about 13,000. One quarter of this employment qualifies as high-tech. Traditional travel agencies which rely on GDSs for accessing and booking travel products, employ approximately 300,000 travel professionals across the 27 EU countries.
"The last decade saw explosive growth in online travel sales in Europe, and this is now a fundamental part of travel shopping," says the study's author Douglas Quinby of PhoCusWright. "The industry has been a bright spot in the European economy during the recession."
PhoCusWright found that Internet bookings outperformed the broader travel industry in 2009, with sales by OTAs in the European Union topping EUR24 billion in 2009. OTAs are growing particularly fast in the emerging economies of Central and Eastern Europe, and will become even more important in response to demand for more regional and international travel options.
"Our industry's value was highlighted during the volcanic ash crisis when we helped thousands of stranded travellers get home," Tom Parker observes. "This also revealed the tantalizing prospect of using our technology to leverage the full potential of the European rail system."
"Efforts by some airlines to limit distribution through intermediaries, unbundle their travel offerings and obscure the associated costs pose a risk to product and pricing transparency," concludes Tom Parker. "This study should motivate policymakers to take a closer look, and to consider expanding consumer protection in EU directives on package travel and air passenger rights."
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