A Global Distribution System (GDS) is a centralized computerized network that serves as a B2B interface between travel service providers and travel agencies. It consolidates real-time data on inventory, scheduling, and prices from airlines, hotels, car rentals, and rail providers and empowers agents to look up, book, and ticket complex travel itineraries in a secure and efficient way.
Originally developed in the 1960s by the airline industry to automate the booking process (starting with American Airlines’ Sabre), GDSs are now the basic infrastructure of global travel. While the consumer-facing websites (OTA) cater to leisure travel, the Global Distribution System is the dominant force in corporate travel.
It acts as a massive conduit. On one side, it draws raw data, i.e., from PSS (Passenger Service System) of airlines or CRS (Central Reservation System) of hotel chains. On the other side, it shares this data with hundreds of thousands of travel agents and Travel Management Companies (TMCs) all over the world.
The Global Distribution System (GDS) market is an oligopoly dominated by three major providers who have their strongholds in different geographical regions:
For decades, the Global Distribution System relied on a legacy coding standard called EDIFACT. While quite efficient in terms of data transmission (simple text information: schedule, price, availability, etc.), it could not be used to display rich content (photos, seat maps, detailed product descriptions, etc.).
This resulted in the development of NDC (New Distribution Capability), an IATA-led XML-based standard. NDC enables airlines to send rich content and personalized offers. Modern GDS providers are now developing into travel platforms, which integrate NDC content in addition to traditional EDIFACT content to ensure they are relevant in a modern, visual tech landscape.
No. The GDS is a professional tool for use by professionals on a B2B basis. However, the case is that when you book a flight on a site like Expedia or Kayak, that website is often running a search query in the background through a GDS to get the flight data.
Industry experts for years have been predicting the death of the Global Distribution System (GDS), and it has not gone away. While airlines are moving forward in pushing for more direct bookings (bypassing GDS fees), the GDS is the only system that can handle the complexity and volume of worldwide corporate travel and interlining (connecting flights between different airlines).
They work on the transaction fee model. The supplier (e.g., the airline or hotel) pays a segment fee or distribution fee to the GDS for every booking made through the network.
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