IATA welcomes US Dept. of Transportation final approval of Resolution 787

The International Air Transport Association (IATA) welcomed the decision by the United States Department of Transportation (DOT) to grant final approval to Resolution 787¹. The Resolution is the foundation document for the New Distribution Capability (NDC), a travel industry-supported program launched by IATA for the development and market adoption of a new, XML-based data transmission standard. “This is a very exciting development for air travelers, airlines, intermediaries, and for competition,” said Tony Tyler, IATA’s Director General and CEO.

The final approval leaves unchanged DOT’s tentative decision approving Resolution 787, which occurred on 21 May 2014. In the tentative decision DOT stated that, “Comparison shopping under the current system is generally limited strictly to comparing fares, and it is difficult to make price quality comparisons of different carriers’ product offerings….The modernized communication standards and protocols and the marketing innovations that [Resolution 787] could facilitate would be procompetitive and in the public interest.”

As part of its tentative and final approvals, DOT accepted the conditions proposed by IATA and Open Allies for Airfare Transparency to ensure that no traveler is required to supply personal information to receive an airfare offer (“anonymous shopping”); that the standard remains voluntary and that each airline is free to choose its own data exchange methodologies.

“Since Resolution 787 was adopted by the Passenger Services Conference, IATA has emphasized that NDC will be a voluntary standard and that no passenger will be required to divulge personal information to receive an offer. We are pleased to reaffirm those commitments,” said Tyler² .

According to DOT, Resolution 787 will “create modern, industry-wide technical standards and protocols for data transmission throughout the distribution chain, promoting efficiency, cost savings, and innovation through a real-time exchange of price and service information among carriers, travel agents, customers, and other parties, such as web-based aggregators.” Furthermore, “the use of common technical standards could facilitate the marketplace development of distribution practices and channels that would make it easier for consumers to compare competing carriers’ fares and ancillary products across multiple distribution channels, make purchasing more convenient, allow carriers to customize service and amenity offers, and increase transparency, efficiency, and competition.”

“With the path now clear to begin to implement NDC on a voluntary basis, the next step is the release of the first comprehensive set of NDC end-to-end schemas, so the travel industry can start defining how to best take advantage of the new capability. We look forward to working with all stakeholders to advance the standard for transmission of airline product offers. This will enable travel sellers and consumers to have access to all of an airline’s products and offerings and to compare the full value of the product offer, not just the base fare,” said Tyler.

References

1. Resolution 787 was adopted by the Passenger Services Conference during its 18-19 October 2012 meeting in Abu Dhabi. Following DOT approval of the Resolution, IATA has declared this effective from 7 August.  The conditions imposed by DOT have been recorded in IATA’s declaration of effectiveness, and will be equally published in the next edition of the Passenger Services Conference Resolutions Manual.
2. While DOT’s conditions are limited to activities subject to United States jurisdiction, IATA’s view is that these conditions, the 2013 IATA AGM Resolution regarding NDC, and the Joint Filing with Open Allies for Airfare Transparency, stand as clarifications of the original intent of Resolution 787, and provide explanatory guidance to the global airline community on how to implement NDC.