BEFORE THE

OFFICE OF THE SECRETARY

U.S. DEPARTMENT OF TRANSPORTATION

WASHINGTON, DC

­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­­ )

In the matter of )

)

Agreement Adopted by the ) Docket No. OST­2013­0048

Passenger Services Conference )

Of the International Air Transport )

Association as Resolution 787 )

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COMMENTS OF

CONSUMER TRAVEL ALLIANCE

(JOINED BY AIRLINEPASSENGERS.COM)

ON THE APPLICATION FOR APPROVAL OF AN AGREEMENT (RESOLUTION 787)

BY THE INTERNATIONAL AIR TRANSPORT ASSOCIATION (IATA)

Mr. Charles Leocha

Director

Consumer Travel Alliance, Inc.

PO Box 15286

Washington DC 20003

(202)713­9596

www.consumertravelalliance.org

leocha@consumertravelalliance.org

April 29, 2013

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COMMENTS OF

CONSUMER TRAVEL ALLIANCE

The Consumer Travel Alliance (CTA) is a nonprofit, nonpartisan organization that works to

provide a clear and reasoned voice in decisions that affect travel consumers across

travel’s entire spectrum. CTA’s staff gathers facts, analyzes issues, and disseminates that

information to the public, the travel industry, regulators and policy makers.

IATA’s Application for for Approval of an Agreement (Resolution 787) by the

Department of Transportation (DOT) should be DOA.

● DOT should never approve an application that seeks to limit technology.

● DOT should never approve an application that seeks to limit consumers’ ability to

comparison shop for prices across an industry.

● If these are not the goals of IATA, then DOT does not have sufficient information in

this application to make an informed decision.

If IATA’s Resolution 787 is merely a standards­setting exercise as they claim on page 2 of

their application, it can be considered as submitted “for information.” Standards have been

set for decades to facilitate the sale of airline tickets through various organizations such as

opentravel.org, ATA (now A4A), ARC, ATPCo and IATA itself, without ever obtaining the

'imprimatur' of DOT that IATA seeks here."

What Resolution 787 seems to be proposing is a new business model and the

standardization of computer language that is far different from previous standards that

applied to data. This is harmful to the aviation industry as a whole because it will stymie

innovation, competition and technology development. Any rules that specify data format are

anti­technology and anti­progress.

This application begs many questions about the vision of IATA. This application, among

other claims, mentions that airlines may or may not utilize this new distribution capability,

passengers may or may not provide additional data, airlines are not obligated to

implement provisions, no technological changes will be compelled, legacy networks can

use established systems, costs based on profiling may or may not be instituted,

“anonymous” fare quotes will continue, and the current system will be maintained in parallel.

It is filled with “mays,” “ifs” and unknowns.

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Exactly what is IATA asking DOT to approve?

The Consumer Travel Alliance has been told by IATA that it is filing this application

because it must report actions such as this to DOT. In effect, then, it is not an approval that

is requesting, but this is only a report of their “facilitative functions” according to Order

2012­4­18 in Docket OST­2012­0058. In that case a simple, “Thank you, we have received your

report,” may be sufficient for them to fulfill their requirements under the order.

The Consumer Travel Alliance believes Resolution 787 is far more than a “facilitative

function” and that it is problematic to competition and consumers because it allows for a

framework for implementation of unfair and deceptive pricing through a system that would

be controlled by the airlines.

Consumers are not served by a restrictive resolution that limits IT language and access to

dynamic airline airfare and ancillary fee descriptions and pricing.

● DOT should not approve specific computer language for future information

technology operations and should certainly not add its formal approval to one

business model for the distribution of airline tickets as opposed to other models.

● Standards­setting organizations already exist that can implement data standards

without specifying what technology will be used to handle that data.

● IATA clearly acknowledges that airlines are withholding data that would assist

consumers in making buying decisions.

● A mandate by DOT to require that airlines release all of their pricing data, without

specifying XML format, would allow technology developers to handle the new

complexities being introduced by airlines to their pricing models.

● Freeing airline data would allow all technology players to compete to create the best

overall system for providing consumers the ability to comparison shop across

airlines including all ancillary fees.

● DOT should require all airlines to file clear tariffs and disclose ancillary fees.

Developing a system of prices that are “dynamically assembled” (See IATA, p. 8) on

an airline­by­airline and and consumer­by­consumer basis using a system operated

and developed by airlines, without the ability to comparison shop across the full

range of publicly posted prices would doom consumers to accepting whatever

convoluted pricing airlines offered.

● This IATA application is neither pro­competitive, nor pro­consumer. In fact, it sets

the stage for even more uncertainty in airline pricing and more opportunities for

unfair and deceptive practices.

● Comparison shopping of the entire airline product across competing airlines must

be available in order for consumers to make “informed choices.”

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Specifying technology is counterproductive and harmful

The airlines as a group dictating one monopoly programming language to be used on a

platform, which the airlines would coincidentally own, is a terrible idea and one from which

DOT should withhold the requested blessing.

Even if Resolution 787 was a standard setting exercise as opposed to a new

carrier­controlled business model, XML, the language being proposed by IATA in its

application, is already used in some format by virtually every airline distribution system in

existence — direct connect models, GDSs, internal airline central reservation systems,

other travel reservation systems.

In the information technology (IT) world, the best computer language is normally the winner

when it comes to sharing data across systems. However, the best computer language

might not be the latest, it may be the language that is understood across multiple platforms

and in the next few years that allows data to be shared effectively; that computer language

may change.

On page 6 of the IATA application, IATA notes two essential goals in drafting the XML data

standard — 1) Ensure the data specification accommodates all of the business functions...

2) attempt to standardize the format for any data...

These goals are anti­technology and ultimately anti­consumer. The Consumer Travel

Alliance and its cosigners believes that the goals should read, 1) Ensuring data is available

to accommodate all of the business functions ... and 2) attempt to standardize the data any

stakeholder might request and choose to use. This kind of language ensures that

consumers can have access to full data needed in any buying decision and it allows IT

systems to utilize the best possible computer language solutions available.

Every time that DOT reads that IATA wants to specify “data formats,” they should read that

as IT poison to future innovation.

Withholding data harms consumer choice

IATA on page 4 of their application note, “For decades, airline shopping has been based

on only two factors; schedule and price, using “low fare search engines” to find only a

single, often restricted, fare. Sole reliance on only those two factors has eroded as airlines

added amenities...”

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Consumers have not relied solely on only those two factors by choice but because airlines

have restricted other data. The airlines have been adamant about restricting shopping to

only those two factors, by refusing to disclose ancillary fee data to outside distribution and

Web information systems such as GDSs and Google. This refusal to disclose ancillary fees

and allow them to be transactable has damaged the consumers’ ability to comparison

shop.

“Price transparency alone is no longer enough to make an informed choice — true

transparency means disclosing price along with the corresponding product

information.”

This astounding admission (at the bottom of page 4) by IATA indicates they have been

knowingly withholding information necessary to make an “informed decision.” The

Consumer Travel Alliance and its cosigners believes this is an admission by IATA that the

airlines are providing incomplete information that is not transparent, but misleading and

deceptive because of its incompleteness.

Added data passing between airlines and consumers requires new privacy

protections

Page 13 of the IATA proposal notes that “attributes about a passenger” that will be

considered may include: “Name/Age/Marital Status, Contact Details, Frequent Flier

Number, or Profile number, Customer Type, Travel History, Nationality, Shopping History,

Previously Purchased Services ... and perhaps others... to contribute to a more customized

shopping experience...”

The airline central reservation systems, GDSs and travel agencies will have to develop

systems to protect personally identifiable information (PII) that does not exist today within

any reservation system and DOT should adopt policies protecting consumers' legitimate

privacy expectations.

CONCLUSION

CTA respectfully asks that DOT not approve this application. A simply thank you for

forwarding this to DOT in accordance with Order 2012­4­18 in Docket OST­2012­0058 should

be the extent of DOT action. The IATA request is speculative and is not a specific resolution. It

is riddled with extensive exemptions and caveats in an attempt to make it conform with the

above order.

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IATA admits in its application that this is “aspirational.” The association also notes that its

standards­setting actions do not need approval. This application and its implementation

should simply be dismissed as too speculative and unspecific for DOT action. Approving it

may be potentially “contrary to the public interest” under 49 U.S.C. Sec, 41309.

Technological challenges facing the aviation industry should not be arbitrated by DOT, but

by the market.

Only when regulated parties are found to be engaged in collusive activities, misleading and

deceptive pricing or where safety is involved should DOT make a pronouncement. And,

certainly, DOT should not endorse unspecific plans that may result in consumer harm.

Based on a lack of information about IATA’s ultimate plans and capabilities of this system

for which they seek approval, DOT should not approve actions that may turn out to be

contrary to public interest.

Also, based on statements contained in this application that consumers today are not

receiving enough information “to make informed decisions,” DOT’s Enforcement Division

1

should mandate immediately that airlines fully disclose airfares together with ancillary fee

pricing data so IT programs can be freely developed with which consumers can make

“informed decisions.”

1 Application for approval of an Agreement (Resolution 787) by the International Air Transport Association, at

4­5.

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