### BEFORE	THE

UNITED	STATES	DEPARTMENT	OF	TRANSPORTATION WASHINGTON,	D.C.

________________________________________ In	the	Matter	of

Application	for	Approval	of Docket OST

- 2013

- 0048 An	Agreement	(Resolution	787) Adopted	by	the	International Air	Transport	Association

__________________________________________

COMMENTS	OF	FARELOGIX	INC.

Communications	with	respect	to	this	document	should	be	addressed	to:

JAMES	K.	DAVIDSON EDNA	W.	LOPEZ

President	&	CEO SVP	&	General	Counsel Farelogix	Inc. Farelogix	Inc.

760	NW	107	Avenue 760	NW	107	Avenue

Suite	300 Suite	300 Miami,	FL	33172 Miami,	FL	33172 jd avidson@farelogix.co m elopez@farelogix.com

April	30,	2013

### 2 BEFORE	THE

U.S.	DEPARTMENT	OF	TRANSPORTATION WASHINGTON,	D.C.

_____________________________________________ IN	THE	MATTER	OF

Docket OST

- 2013

- 0048

APPLICATION	FOR	APPROVAL	OF	AN AGREEMENT	(RESOLUTION	787)

ADOPTED	BY	INTERNATIONAL	AIR

TRANSPORT	ASSOCIATION

___________________________________________________



### COMMENT	OF	FARELOGIX	INC. APPLICATION	FOR	APPROVAL	OF	AN	AGREEMENT	(RESOLU TION	787)	BY	THE

INTERNATIONAL	AIR	TRANSPORT	ASSOCIATION

Farelogix	Inc.,	a	technology	provider	to	airlines,	submits	the	following	comments	in	support of	IATA’s	Application	for	Approval	of	Resolution	787	(hereinafter	referred	to	as	the	“New Distribution	Capability”	or	“NDC”).

This	enhanced	airline	distribution resolution	provides	for	the	adoption	of	a	messaging standard,	based	on	XML	programming	language,	that	airlines	can	choose	to	adopt	in	order to	dynamically	sell	their	products	and	services	through	the	indirect	channel	(i.e.,	travel agents,	OTAs,	GDSs,	TMCs, etc.).			This	resolution	will	therefore	help	the	airline	industry evolve	and	modernize	to	the	benefit	of	all	the	participants	in	the	air	travel	industry

— from airlines	to	intermediaries	to	travel	sellers	to	the	millions	of	ticket	purchasers

— and	do	so	in

a manner	that	is	consistent	and	efficient.

By	adopting	this	resolution,	IATA’s	goal	is	simple:	develop	a	technology	standard	so	that

third

- party	travel	sellers	can	efficiently	access	airline	product	and	service	information	(for

those	airlines	that	choose	to participate,	as	this	is	not	a	mandate)	that	is	provided dynamically	by	the	airline	using	traveler	authentication	(i.e.,	processing	a	pricing	request based	on	traveler	status	or	identity)	when	the	traveler	authorizes	the	airline	to	do	so.	This standard	pro vides	two	distinct	categories	of	benefit:

(1) Increased	airline	product	innovation	and	consumer	choice .			By	modernizing the	current	messaging	capability	between	airlines	and	travel	sellers,	airlines	are able	to	create	unique,	personalized	offers	to	compete for	the	customer	on	each	and every	transaction,	in	a	similar	manner	to	what	is	being	done	in	most,	if	not	all,	e

commerce	retail	environments.		This	enables	travelers	to	customize	their	trips exactly	to	their	liking

— all	with	the	highest	standard	of	transp arency.		It	also	stands to	increase	the	value	of	travel	sellers	by	allowing	them	to	provide	a	wider	range	of airline	products	and	services	to	their	customers.

(2) Industry

- wide	consistency	and	cost

- saving	standardization. The	NDC	initiative offers	a	modern, data	exchange	XML

- based	standard	to	be	used	by	all	third	parties

### 3 wanting	to	access	information	from	the	airlines.			To	the	extent	some	of	the	new capability	is	offered	today	(e.g.,	airlines	today	that	are	making	a	limited	number	of optional	services	and/o r	product	bundles	available	to	travel	agencies/GDS),	those limited	versions	not	only	are	lacking	the	dynamic	and	personalization	capabilities featured	in	NDC,	but	are	also	achieved	in	a	wide	range	of	ways	(including	custom web	services,	APIs,	and	fare	fili ng	methods),	creating	wasteful	and	inefficient multiplication	of	efforts	each	time	an	airline	connects	to	a	different	third	party.			In keeping	with	its	purpose,	IATA	is	seeking	to	provide	one	consistent	standard	that

meets	modern	e

- commerce	requirements	t hat	can	be	available	for	use	across	the entire	industry.

We	specifically	address	the	issue	raised	in	the	Application	of	whether	Resolution	787 promotes	or	unreasonably	restrains	competition	in	air	transportation,	or	as	more	simply put	by	IATA	“whether	th is	industry	initiative	advances	the	interest	of	the	traveling	public.” As	described	below,	we	rely	upon	facts,	rather	than	hyperbole	or	protectionism,	to	support

our	conclusion	that	it	does	so.

I.			RESOLUTION	787	MODERNIZES	CURRENT	MESSAGING	CAPABILITI ES,	WHILE

PROVIDING	CONSUMERS	WITH	INCREASED	CHOICES	AND	AUTHENTICATED	TRAVEL

OPTIONS	WITH	HIGHEST	LEVELS	OF	TRANSPARENCY

Farelogix	wholeheartedly	agrees	with	IATA	that	Resolution	787	supports	enhanced consumer	choice	and	offer	comparison.			IATA	has	selected	the	Open	Axis	messaging schema,	a	proven	messaging	standard,	as	the	base	from	which	the	NDC	schema	will	be

derived. As	an	early	promoter	of	the	Open	Axis	schema,	Farelogix	has	developed	its technology	to	comply	with	that	base	schema	and	can	demonstrate	the	enhanced	choice	and comparison	that	NDC	is	seeking	to	foster	with	its	new	standard.

Because	we	believe	“a	pic ture	is	worth	1000	words,”	Farelogix	submits	the	following screenshots	that	plainly	and	clearly	demonstrate	the	opportunity	for	offering	new	types	of airline	products,	as	well	as	the	high	degree	of	transparency	that	is	inherent	when	travel technology	compa nies	develop	applications	utilizing	the	NDC	standard.			These	examples are	taken	directly	from	our	live	system	although	the	names	of	the	airline	products	have been	changed	in	order	to	protect	customer	confidentiality.			It	is	important	to	note	that	the

NDC resolution	only	pertains	to	the	standardizing	of	XML	data	transmissions,	and	not	to	the look	and	feel	of	the	presentation	layer	(display	screens)	shown	to	consumers.			The development	of	consumer

- friendly	presentation	layers	is	left	up	to	each	developer. Nonetheless,	we	can	demonstrate	that	providing	consumers	with	multiple	or	varying options	on	the	same	screen	is	neither	difficult	nor	confusing,	as	some	critics	have	argued

– and	to	the	contrary,	delivers	new	degrees	of	capability	to	travel	agents	and	co nsumers	that have	until	now	only	been	available	on	airline	websites.

The	screenshots	in	the	following	pages	(taken	from	a	Farelogix	agency	desktop	application called	SPRK)	display	the	products	of	multiple	airlines	that	already	today	use	a	messaging

standa rd	(Open	AXIS)	that	is	the	baseline	for	version	1.0	of	the	new	IATA	NDC	standard.

### 4 Figure	1

Figure	1 shows	a	response	to	a	search	request	for	travelers	going	round

- trip	from	Chicago to	London.			Note	that	multiple	airlines	(American,	Lufthansa,	and	Unit ed)	are	shown	in	the same	display,	with	each	airline	showing	its	products	in	the	way	it	chooses.			Also,	the	search results	for	each	airline	can	be	expanded	or	collapsed	on	the	screen	in	order	to	allow	the viewer	to	see	whatever	solution	(or	offer)	is	desi red.

At	this	stage	in	the	search	request,	the	traveler	can	either	search	anonymously 1 or	provide additional	information	(such	as	frequent	flyer	number)	and,	in	both	instances,	receive

search	results	that	are fully	transparent and	comparable	across airlines

.

1 In our view, even an “anonymous” request is in fact an authenticated request to an airline. It is simply authenticated as “anonymous” and priced accordingly.

### 5 Figure	1 also	shows	how	one	airline	can	return	bundled	fares	while	the	other	airline	returns standard	fares.			Not	only	does	this	demonstrate	that	the	standard	generates	a	comparison of	fares	and	transparency,	but	also	there	is more	information provided	to	travelers than what	is	traditionally	provided	to	travel	agencies	today	in	terms	of	ancillary	services.			Using the	new	standard,	there	is	no	confusion	as	to	what	each	airline	is	offering.

By	simply	hovering	over	each	bundle,	it	is	simple	t o	see	what	services	are	included,	all	while still	on	the	search	screen,	as	demonstrated	in Figure	2 below.

Figure	2

Below, Figure	3 shows	the	personalization	that	is	possible	when	a	corporation	negotiates	a specific	corporate	bundle	with	an	airl ine.			In	such	a	situation,	the	traveler	(using	a corporate	booking	tool)	or	the	travel	agency	(on	behalf	of	the	corporate	customer)	can provide	a	particular	corporate	ID	number	and	retrieve	a	search	display	that	shows	the corporate	bundle	alongside	the	re gular	bundled	fares	offered	to	all	travelers.			This	is possible	because	the	information	is	validated	with	the	airline	at	the	time	of	the	search
request.

### 6 Figure	3

Figure	4 below	is	an	example	of	the	different	pricing	for	ancillary	services	that	return	for multiple	travelers	based	on	their	frequent	flyer	status.			All	pricing	is	transparent	for	each traveler,	and	all	prior	to	the	traveler	booking	the	flight.			More	important ly, the	traveler’s status	is	validated	at	the	time	of	the	search ,	so	that	only	accurate	and	relevant	pricing	is presented	to	the	traveler. 2 We	are	aware	that	other	providers,	including	certain	GDSs,	only validate	the	traveler’s	status	after	the	booking	i s	made.			This	process	creates	confusion	if the	traveler	books	the	flight	or	service	expecting	to	pay	a	certain	price,	only	to	find	out	after the	status	validation	that	the	traveler	was	not	eligible	for	that	price.

Note	that	each	traveler	is	presented with	different	pricing	for	its	ancillary	services,	in	each case	based	on	that	traveler’s	frequent	flyer	status.			In	what	some	like	to	call	the “democratization”	of	airline	travel,	travelers	with	no	status	are	presented	with	an opportunity	to	purchase	the services	that	are	generally	provided	for	free	to	travelers	with	a higher	status.			The	ability	to	choose	is	always	at	the	option	of	the	traveler	since	needs	and desires	can	vary	depending	on	whether	one	is	traveling	for	business,	pleasure,	alone	or	with

fr iends	and	family,	short

- haul	domestic,	or	overnight	internationally.

2 In the case where a traveler chooses to remain anonymous, the status is validated as anonymous and the traveler gets accurate information relevant to that status.

### 7 Figure	4

It	is	important	again	to	note	that,	if	the	traveler	does	not	provide	any	additional	information beyond	what	is	required	today	(adult/child,	city	pair),	then	the	traveler	s till	gets	a	pricing response	based	on	generic	pricing	parameters.			The	traveler	can	remain	anonymous	(see Figure	5 )	or	provide	additional	information,	however	the	traveler	chooses.			The	choice	of how	much	information	to	provide	is	left	up	to	the	traveler

.

### 8 Figure	5 demonstrates	choices	available	to	travelers	who	have	opted	to	remain	anonymous. As	you	can	see,	in	contrast	to Figure	4 ,	there	is	no	traveler	name	shown	and	the	pricing	does not	reflect	frequent	traveler	status.

Figure	5

Figure	6 demonstrates	a	seat	map,	with	personalized	pricing	based	on	frequent	flyer	status, available	to	the	traveler	prior	to	booking	the	flight	so	that	the	traveler	can	choose	whether the	seating	options	available	make	it	worthwhile	to	book	the	particular	flight or	choose another	with	seat	availability	better	suited	to	the	traveler’s	needs.

Figure	6

### 9 Figure	7 shows	how	marketing	images	and	video	can	be	included	within	the	XML	message itself	for	display	at	the	point	of	sale.			This	delivers	greater	choices	and transparency	for	the consumer	(in	this	case,	the	capability	to	see	a	video	of	the	business	class	seat	she	may choose	to	purchase),	all	early	in	the	shopping	process.

Figure	7

A	central	feature	of	the	IATA	NDC	standard	is	that	the	airline	is	able	to	provide	a	real

- time, validated	offer,	including	all	ancillary	services,	to	the	traveler	at	the	time	of	the	search request.			This	is	because	the	offer	is	created	by	the	airline	itsel f,	and	not	by	the intermediary,	ensuring	the	traveler	gets	the	most	accurate,	relevant,	and	up

- to

- date	offer from	the	airline.			From	a	travel	agency	point	of	view,	having	the	airline	create	the	offer eliminates	any	possibility	for	pricing	inaccuracies	tha t	today	result	in	potential	debit	memos being	issued	to	the	travel	agency.			This	improves	pricing	accuracy	and	eliminates	consumer or	travel	agent	confusion	as	to	whether	or	not	a	certain	offer	is	valid	for	a	particular

traveler.

In	another	example,	av ailable	to	all	consumers	today	and	shown	in Figure	8 below, Priceline.com	presents	American	Airline	and	United	Airline	flights	using	the	messaging standard	espoused	by	Resolution	787 3 .			In	the	case	of	American,	Priceline	is	already	able	to offer	personali zed	seat	choices,	based	on	frequent	flyer	status,	at	the	time	of	shopping,	a direct	result	of	the	modern	connectivity	between	the	airline	and	the	OTA.

3 In	addition	to	these	examples,	American	Airlines	and	Travelport	recently	announced	their	new distribution	partnership	whereby	Travelport	wi ll	connect	to	American’s	XML

- based	direct	connect interface,	which	utilizes	the	same	Open	Axis	base	as	the	NDC	schema,	to	provide	Travelport	agencies with	all	of	American’s	product	offers	in	a	dynamic	and	personalized	manner.

### 10 Figure	8

### 11 The	screenshot	examples	shown	in	the	previous	pages	also	serve	to	invalidate	some	of	the

fal se	claims	about	IATA	Resolution	787.			In	particular, Figure	1 addresses	one	key	criticism: the	fear	that	a	particular	airline	is	going	to	increase	pricing	to	a	specific	traveler	because	it is	aware	of	the	traveler’s	history	or	purchasing	patterns.			This fear	is	clearly	unfounded when	there	are	multiple	airlines	flying	and	competing	for	travelers	on	the	very	same requested	routes.

To	elaborate	a	bit	on	this	point,	some	are	suggesting	that,	by	adopting	NDC,	airlines	will	be

able	to	collect	more	informatio n	on	passengers	and	therefore	be	able	to	charge	them	more than	what	the	market	price	would	normally	be.			It	is	difficult	to	understand	how	an	airline having	more	information	on	a	particular	traveler	(e.g.,	frequent	flyer	status	or	purchasing history)	coul d	force	a	traveler	to	unwillingly	pay	a	higher	price when	the	traveler	can simply	choose	another	airline	from	the	same	display. As	demonstrated	above,	an aggregated	search	display	will	return	multiple	airline	choices	so	long	as	there	are	multiple

airline s	flying	the	requested	routes.			In	a	competitive	marketplace,	any	airline	that overcharges	customers	quickly	loses	those	customers.			And	if	the	airline	has	little	or	no competition	in	a	particular	market,	it	would	seem	more	plausible	to	believe	that	the airline would	increase	prices	on	ALL	consumers,	regardless	of	who	they	are	or	what	information they	provide,	simply	because	of	the	lack	of	competition. 4 The	norm	in	any	retail	business	is that	frequent	buying	gives	consumers	more	perks	and	discounts,	not less.			We	do	not understand	why	this	would	be	any	different	for	airlines.			More	to	the	point,	today’s	airline websites	are	the	one	place	where	an	airline	could	presumably	be	able	to	freely	exploit	this ability	to	charge	higher	prices:		airlines	often	ha ve	prior	history	on	travelers	that	log	into their	websites,	and	on	an	airline	website	travelers	are	only	looking	at	flights	from	the specific	airline	as	opposed	to	an	aggregated	agency	display	with	multiple	airlines	(which	is what	IATA	NDC	is	created	for). A	traveler	is	more	likely	to	be	“captive”	on	an	airline website	today	and	yet	we	do	not	hear	of	any	airlines	charging	higher	prices	there.			If	they did,	the	traveler	could	simply	log	out	and	choose	another	website.

As	illustrated	by Figures	4	and	5

, the	new	standard	offers	travelers	the	choice	of	whether	to share	information	such	as	frequent	traveler	ID,	or	whether	to	search	anonymously. Accusations	that	somehow	the	IATA	NDC	initiative	will	mandate	disclosure	of	personal information	are	entirely	fals e	and	contrary	to	the	workings	of	any	successful	e

- commerce marketplace.

Another	concern	that	has	been	raised	is	that	airlines	that	adopt	the	NDC	standard	will	no longer	publically	file	fares	with	the	Airline	Tariff	Publishing	Company	(ATPCO)	and	that	thi s would	somehow	create	a	lack	of	transparency	or	potentially	higher	prices	for	consumers. Evidently	ATPCO	doesn’t	have	this	concern,	since	they	have	publicly	endorsed	IATA	NDC. Furthermore,	whether	or	not	an	airline	chooses	to	file	its	public	or	privat e	fares	with	ATPCO is	a	decision	that	each	individual	airline	already	makes	today	and	one	that	is	not	an	all

- or

nothing	decision.		Many	airlines	that	today	file	with	ATPCO	do	not	file	all	their	fares	there;

4 Whether or not an airline can charge supra

- competitive prices is dependent on the traditional antitrust analysis of the competition available for a particular city pair.

### 12 some	file	their	baggage	fees	and	some	don’t;	some file	certain	ancillaries	and	not	others. Each	case	is	already	an	independent	evaluation	by	each	airline.				More	importantly,	an

airline’s	decision	on	whether	to

-- or	what	to

-- file	with	ATPCO	has	nothing	to	do	with	the competitive	nature	of	the	airli ne	marketplace;	in	fact,	many	of	the	low	cost	airlines	are	the ones	that	today	don’t	file	with	ATPCO	and	are	the	same	ones	that	offer	the	most	competitive prices	today	(and	are	also	the	ones	that	have	traditionally	offered	consumers	a	plethora	of ancillary options). 5



### II.				ONCE	AND	YOU’RE	DONE

The	rationale	for	implementing	a	standard	is	not	rocket	science:	Without	a	standard,	the fact	that	multiple	companies	want	access	to	airline	offers	necessarily	leads	to	multiple	ways of	requesting	the	information, with	multiple	development	efforts,	and	multiple	time	periods to	implement	the	same	thing	across	numerous	distribution	outlets.			Wasted	time,	wasted effort,	and	wasted	money.			Just	like	e

- ticketing	is	done	in	one	way	by	everyone	and	bar

codes	are	identic al	across	multiple	industries,	dynamic	messaging	needs	to	be	done	in	a standard,	modern	way.			And	the	time	to	implement	the	standard	is now ,	while	the provision	of	ancillary	services	is	still	in	its	infancy	and	before	hundreds	of	millions	of	dollars

are	w asted	by	airlines	connecting	to	distributors	and	aggregators	in	multiple	ways.

The	benefits	of	standardization	have	long	been	recognized	within	the	industry	as	a	way	to provide	consistency	and	cost

- effective	development	for	a	wide	range	of	third	parties	(GDSs, online	travel	agencies,	corporate	booking	tools,	airlines)	that	make	up	th e	travel	supply

chain.

IATA	787	is	open	to	anyone	who	wishes	to	develop	to	the	standard.			No	one	is	prevented; no	one	is	blocked.			In	fact,	it	will	enhance	competition	by	making	it	easier	for	new	entrants to	the	travel	distribution	industry	to	develop the	required	connectivity	to	airlines	with	a modern	messaging	language	that	is	widespread	and	commonly	used	today,	thereby enabling	those	new	entrants	to	utilize	a	cost

- effective	and	readily	available	resource	pool	of programming	talent.		The	more	new	entr ants,	the	greater	the	competition,	and	the	greater the	likely	benefit	to	consumers.



### III.			CRITICS	OF	NDC	HAVE	AN	ULTERIOR	MOTIVE

It	is	evident	from	the	screenshots	above	of	real	examples	in	use	today	that	the	claims	of insufficient	transparency,	anti

- competitiveness,	and	privacy	intrusion	are	patently	untrue. So	where	does	the	current	outcry	against	IATA	Resolution	787	come	from?			In	a	world where	VHS	beat	out	Betamax,	and	Blu

- ray	beat	out	HD	DVD,	battles	over	technology

standards	are	not	uncommon. But	unlike	those	battles	where	equally	new	technologies were	trying	to	gain	market	predominance,	today’s	battle	is	one	of	old	vs.	new,	with	the

5 EasyJet and RyanAir are just two examples of low cost airlines that do not file with ATPCO. There are

many m ore examples.

### 13 dominant	players	in	the	old	technology	trying	to	prevent,	or	at	the	very	least	to	delay,	the implementation	o f	the	new	standard	in	order	to	retain	artificial	control	of	the	distribution marketplace.			As	a	result,	we	are	hearing	more	and	more	absurd	comments	from	those looking	to	prevent	innovation.

In	our	view,	‘transparency’	and	‘privacy	concerns’	are convenient	catchwords	utilized	to gain	public	traction	for	an	otherwise	unsupportable	position,	as	we	have	already	shown above.			The	irony	is	that	the	same	forces	that	lash	out	with	cries	of	“anti

- competitiveness” against	a	new	and	innovative	standard	do nothing	to	decry	the	lack	of	competition	that	has been	inherent	in	the	status	quo.			Instead,	Farelogix	believes	that,	as	recently	came	to	light from	the	volumes	of	documents	unearthed	in	antitrust	litigation	between	American	Airlines and	Sabre	(only	a	sma ll	portion	of	which	survives	publicly) 6 ,	the	real	motivation	behind	the opposition	is	the	desire	to	“target	getting	as	many	things	as	possible	in	place to	neutralize AA	[American]	market	moves	to	disrupt	the	model. ” 7 For	those	who	have	not	read	the publi c	version	of	the American	v.	Sabre trial	transcripts,	this	was	the	secret	motive	behind Sabre’s	attempts	to	stop	American’s	Direct	Connect	at	all	costs.			Evidently,	Sabre’s	previous

focus	on	American	Airlines	has	now	shifted	to	IATA	NDC.

Contrary	to	what some	critics	of	NDC	allege,	NDC	does	not	in	any	way	impose	any	new business	model	on	the	industry.			Critics	point	to	the	use	of	business	requirements	in coming	up	with	the	standards	as	a	sign	that	a	new	business	model	is	being	imposed. “Business	requir ements”	are	quite	different	from	a	“business	model.”			While	the	standard necessarily	takes	into	account	the	features	that	airlines	desire	(without	which	a	standard couldn’t	even	be	developed),	it	has	nothing	to	say	about	the	commercial	arrangements	that

m ay	result	from	it.			Airlines	and	intermediaries	that	choose	to	adopt	the	standard	may	use the	dynamic	messaging	capability	under	any	business	model	they	desire.			This	is	not something	IATA	can	determine,	let	alone	impose,	on	the	industry.			Rather,	any	e ffect	on current	business	models	will	necessarily	play	out	over	time

— and	likely	in	multiple	ways

— as	each	airline,	agency,	and	GDS	negotiates	its	value	in	the	distribution	chain.

Although	IATA’s	NDC	is	independent	of	any	business	model,	the	fear	that	the business model	will	differ	from	that	which	is	prevalent	today	is	the	key	driver	behind	the	opposition.

This	is	again	demonstrated	by	internal	Sabre	documents	that	were	disclosed	at	the	trial where	Sabre	discussed	that	its	tactics	against	American	Airli nes	were	not	only	about		“AA, but	about	GDS	distribution, the	Sabre	GDS	strategy,	and	the	future	of	indirect distribution	in	general .” 8 This	seems	all	the	more	obvious	since	another	of	Sabre’s specific	strategic	goals	that	came	to	light	from	the	litigat ion	was	to	“ shut	down	FLGX” [Farelogix]. 9 All	of	this	is	consistent	with	a	desire	to	ensure	that	the	status	quo	stays	in place.

6 American Airlines v Sabre, Inc., 067

- 249214

- 10, Tarrant County, Texas, District Court for the 67 th

Judicial District

7 Id., Plaintiff’s Exhibit PTX 642

8 Id., Plaintiff’s Exhibit PTX 0018

9 Id., Plaintiff’s Exhibit PTX 7011

### 14 Other	evidence	demonstrates	the	disingenuousness	of	the	GDS	attack	on	NDC.			The	real	lack of	transparency	comes	from	the	a bility	of	GDSs	to	secretly	bias	airline	flights,	a	true	anti

competitive	practice	employed	by	Sabre	that	was	also	exposed	during	the	litigation.			As stated	in	one	internal	email,	the	tactic	is	wielded	in	order	to	coerce	airline	cooperation:	“Do you	know	i f	we	can	implement	the	type	of	display	restrictions	with	AA	that	we	have contemplated	doing	in	the	past	with	other airlines	that	don’t	provide	full	content?” 10 The	ultimate	goal	was	to	be	able	to	secretly	harm	the	airline	with	“a sophisticated	bias

strate gy	that’s hard	to	detect ”,	or “smart	bias ”,	because	they	“don’t	want	an	airline	to understand	what	we’re	[Sabre]	doing.” 11

Even	more	ominous	is	the	GDS’	ability	to	monitor	and	track	the	impact	of	the	biasing,	and

“ ratchet	up	over	time ” 12 ,	escalating	“in	t erms	of	the impact	to	agencies ” 13 and	the	airline.

The	effect	of	all	of	this	is	the	ability	of	the	GDS

– still	unchecked

– to	impact	tens	of thousands	of	consumers,	without	their	knowledge,	on	the	choices	of	flights	made	available to	them,	all	at	the	whi m	of	an	entity	with	sufficient	market	power	to	do	so.			And	that	is	not all.			Travel	agencies,	corporations,	and	even	other	airlines

— codeshare	or	interline
partners

— are	all	adversely	affected.			This	is	true	lack	of	transparency.			This	is	true	anti

compe titiveness.			This	is	the	power	wielded	by	the	GDS,	and	this	is	the	real	issue	that	needs

to	be	addressed.

In	response	to	the	recent	ruling	in	the	Texas	court	that	permanently	sealed	the	remaining records	in	the	litigation	against	Sabre,	an	IATA	official	put	it	well	by	stating: “It	is	ironic	that the	company	that	claims	to	be	for	full	consumer	transparency	wor ked	so	hard	to	keep	these records	from	the	public.” 14

IV.			DOT	SHOULD	APPROVE	IATA	RESOLUTION	787

In	sum,	the	IATA	NDC	standard	is	an	attempt	to	update	the	legacy	static	messaging capability	largely	in	use	today	with	a	dynamic	search	and	pricing	capabil ity	that	provides airlines	with	greater	efficiency	and	consumers	with	a	greater	variety	of	choices	and	more transparency	whether	they	are	shopping	on	the	airline	website	or	through	a	travel	agency. Consumers	today	expect	this.			NDC	encourages	the	use	of modernized	workflows	and technologies	(similar	to	the	Direct	Connect	technology	deployed	by	American	Airlines	and Air	Canada)	that	allow	for	consumers	to	receive	accurate	and	relevant	pricing	information for	all	airline	products

— including	ancillaries	such as	seats,	priority	legroom	and	other options

— consistently	and	efficiently	across	the	myriad	of	distribution	and	aggregation outlets.		Allegations	to	the	contrary	are	untrue	and	constitute	the	GDS	effort	to	maintain their	stronghold	on	information	and	ticke t	pricing.

10 Id., Plaintiff’s Exhibit PTX 1405

11 Id., Plaintiff’s Exhibit PTX 1381

12 Id., Plaintiff’s Exhibit PTX 647

13 Id., Plaintiff’s Exhibit 1381

14 May, Kevin, “IATA fails in bid to have sealed court documents opened from Sabre

- American Airlines case”, Tnooz, Marc h 21, 2013, quoting an IATA official. http://www.tnooz.com/2013/03/21/news/iata

fails

- in

- bid

- to

- have

- sealed

- court

- documents

- opened

- from

- sabre

- american

- airlines

- case/