What the NDC Rollout Means for Travel Advisors

New Distribution Capability (NDC) has become the most common acronym in the travel industry since, well, GDS (global distribution system), but NDC (a technology that enables a richer airline shopping experience for buyers) was even more prominently in the trade news recently when American Airlines set a deadline for distribution channels to be able to connect to it.

Several major industry organizations and other parties protested the deadline but American persisted with the change.

But what does all this mean for travel advisors and the airlines whose tickets they sell? While tickets sold through NDC channels remain a small percentage of all transactions, according to Paige Blunt, senior manager of Direct Connect and ONE Order at Airlines Reporting Corporation (ARC), that number is growing steadily and has already changed the way airlines and advisors do business.

ARC plays two primary roles in the purchase of air travel. One is to be the storehouse for all the data around an airline ticket purchase, collecting that data and analyzing it for many data products. The second, and more prominent role, is being responsible for agency accreditation and settlement so that when a ticket is paid, ARC initiates billing and/or cash settlement on behalf of the airline. All told, ARC serves as an intermediary between almost 300 airlines and 11,000 travel agency offices. It settles airline ticket sales for agencies based in the U.S. and American territories – for flights worldwide.

The kind of resistance around the American Airlines ultimatum, said Blunt, is part of what will be a long process because this is a significant change in the way travel sellers have been doing business for many years. From ARC’s perspective, she said, “We want to support all stakeholders and facilitate them doing business in the way they would like to.”

After several years of existence, said Blunt, NDC in its purest form has become a brand name like Kleenex tissues where everybody uses the term, but it means different things to different providers. Although the technology is standard, implementation can be different depending on the supplier.