Interesting week. AA continues playing a game of chicken with the GDSs, AngelGate, Oracle Open World and more:

1. The game of chicken between American Airlines and the GDSs continue.
2. And in a related note, Open AXIS Group – who’s founding members include American Airlines and Farelogix –  denies the GDSs a dedicated seat on the board.
3. Another day, another billion dollar software acquisition. This time IBM buys Netezza for $1.7B to bring “analytics to the masses”. That brings IBMs BI and analytics software buying spree to over $3.5B in just over a year. You tell me when it feels like they have a cohesive offering.
4. Intrigue and Money – what a great combination. And it was all on display one evening at Bin 38 in San Francisco in what became known as AngelGate, first reported on by TechCrunch’s Michael Arrington. Then the smoke turned into a conflagration with dueling outed emails from some of Silicon Valley’s premier Angels and further commentary by Robert Scoble.
5. A cast of thousands descended upon San Francisco for this year’s Oracle Open World. While keynotes were less than compelling (to be kind) and kabuki theatre starring Larry and Salesforce.com’s Marc Benioff, there was a lot of important announcements with Fusion apps taking center stage.
6. Just goes to show the expected value of search in travel as SNCF Voyages purchases French metasearch startup Liligo gets acquired for somewhere north of €20M.
7. Google-ITA gets its first “win” with an expansion of the relationship with US Airways. Unfortunately flight search can’t impact in-flight customer service and comfort.
8. Virgin to enter the hotel business with $500M burning a hole in their wallets. Should create an interesting challenge to Starwood’s W brand and other boutique hotels.
9. Startup TruPrice provides a total car rental cost calculator that juggles more than 10,000 different fees. I think this is great, especially since adds-ons, airport fees and taxes make up a greater percentage of the total cost than any other aspect of travel.
10. Gartner released a new report on Measuring and Managing IT Debt (the amount of money needed to clear out backlogged projects and deferred maintenance) now estimated at $500 billion globally, and is expected to double over the next five years. Enterprise Irregular Dennis Moore explains what “IT Debt” is and explores how SaaS can help you reduce, although not eliminate it.

There’s so much data in airline systems and from the GDSs, but often it’s in unusable, or at least hard to use, formats.  But that’s life in the big city in the travel industry where many of the systems that generate the data are based on 50 year old technologies and data architectures.  But there’s valuable information hidden in that data which can help boost operational efficiency and revenue optimization strategies.

Driving efficiency is not just for LCCs anymore. I can’t remember the last time the financial performance of any of the big airlines was very strong.  Frankly, it seems more that the larger the airline, the faster the hemorrhaging of cash.  The best performers have been industry “upstarts” like Southwest and JetBlue.

While the large Airlines might have large IT teams to process this data, they don’t always do it.  And smaller and mid-sized airlines always find it a huge challenge – to first find the resources and then to be able to build the appropriate solution. The data comes from GDSs like Amadeus in an EDIFACT file format. It is not normalized and hence cannot be queried. There is an issue of accessing historical data as well.

And unfortunately, much of this data is simply streamed (or available in files at regular intervals – in some cases every hour), not stored anywhere to be accessed later. So it’s use it or lose it.

Ness Software Product Labs is helping a European LCC turn all the data at their disposal into useful information.  Two areas of focus have been trying to learn what they can from the booking data and information from Departure Control Systems. Some of the information that can be gleaned from just these two systems are:

• From the booking data
  • Domestic Revenue Estimation
  • International Revenue Estimation
  • Code-share statistics
  • Bookings originating from Airline special marketing initiatives
  • Productivity by office
• From the Departure Control System feeds:
  • Agent performance
  • No Shows
  • Excess baggage revenues
  • Boarding throughput
  • Fuel data
  • Last minute changes
  • Aircraft performance

Is this something that you think would be helpful, but you don’t have the resources or solution framework to address, let’s chat.

Image source: New York Times

JD Power’s survey on hotel satisfaction is out, Facebook rolls out Questions, Google “borrows” content from Yelp!, Apple adds a few more details to a proposed iTravel app and a few other things that caught my eye:

1. Excellent, excellent post by RedMonk’s Stephen O’Grady on whether Open Source in is maturity, growth or decline.
2. The Big 3 GDSs issue no-response response to Open AXIS. The closest thing to an answer was that they want one standard to rule them all. They just didn’t commit to whose.
3. Norm Rose’s take on the Google/ITA deal.
4. Facebook rolls out Questions to the masses. Tnooz’s Kevin May explores what this might mean for the travel industry.
5. ZDNet’s Phil Wainwright provides a framework of how to choose the right Cloud Computing platform.
6. Google introduces location-aware mobile display ads. Google claims that location-based mobile ads deliver an 8% increase in click through rates.  Should be some significant benefits for the travel industry.
7. New patent details indicate that Apple is planning to enable ancillary services booking from their rumored iTravel app.
8. As location-based content becomes more important for the travel and hospitality industry, Google ramps up its location content under Google Places using Yelp! content.  Understandably, Yelp’s  CEO is not exactly pleased.
9. Steve Cheney has some thoughts about why Apple should buy Infineon’s wireless chipset business to enhance its mobile device business on the (relative) cheap.
10. According to a recent JD Power survey, about 6 in 10 hotel guests made their reservations online in 2010, a 7.4% increase.  And the data suggests that they are more likely to book direct from the branded hotel website rather than an independent travel site.

Well perhaps this week’s installment should be 10 things that happened at Google I/O. It surely dominated the conversation last week. But a few travel items make it as well including a post from FareCompare CEO Rick Seaney. news on Amadeus and Travelport and Google’s Friday acquisition of Ruba.  And in honor of the last episode of Lost, a bonus #11. 

1. Farecompare’s CEO breaks down the airfare pricing rules that seem to make no sense to the average traveler. And it’s just getting harder to make any sense out of it with all the airline fees (or as they call it ancillary revenue).
2. Bob Warfield talks about the huge lead that Amazon has in the Cloud derby and the barriers of entry that they’re creating. However, the recent moves to integrate the VMWare SpringSource technology into Google and Salesforce’s Cloud offerings should make those considering Cloud/PaaS provider take a second look.
3. Travelport becomes the first GDS to buy a meta-search player. I wonder whether this will be the first of several transactions and how much the rumored acquisition of ITA Software by Google is creating a sense of urgency among the GDSs.
4. Big announcements from Google I/O: the Chrome Web Store, Google Wave ready for launch, the open sourcing of the WebM video CODEC (see next item), Google partners with VMWare for AppEngine.  And that was only day one.
5. Google open sources WebM video CODEC, which may throw a monkey wrench into the H.264 bandwagon.  However, perhaps WebM won’t be royalty-free for long, says AllThingsDigital’s John Paczkowski.
6. Netflix jumping on the HTML5 bandwagon with both feet.  And the Wall Street Journal notes that Apple is winning ground in the fight against Flash. Although much of that gain may be given back in light of Froyo and other announcements from I/O.
7. On its face, Google TV looks to be a very big deal. It’s everything that many hoped AppleTV would be.  Although Mashable thought that there’s little here that’s not already in TiVo. But since only about 8 people on the planet own a TiVo, this will be pretty cool to most everybody else. Some think this isn’t so much a shot across Apple or other set-top box maker’s bow, than it is to TV providers.  Here’s some more info, but I’m not sure how much adoption it will see if you still require a cable/satellite set top box.
8. Amadeus making gains with US Travel Agents. Very interesting stats around financial incentives given to travel agents by the GDSs.
9. A good point about the importance efficient software development made on the Ness Software Product Labs blog that I hadn’t really thought about before: Cloud Computing puts a premium on efficient code.  Less efficient code requires more CPU cycles and therefore incurs higher costs in the pay-by-the-drink world of Cloud Computing.
10. Google takes another step on its journey into the travel industry with its purchase of Ruba, the online travel guide and travel community. Ruba’s visual search approach is apparently what caught Google’s eye.  Looks like it will be integrated into iGoogle, at least for now.

And in tribute to the Lost series finale which aired last night…

• A fabulous review of the Apple-Google rivalry by TechCrunch’s MG Siegler…even more so if you’re a “Lost” fan like me.

Here’s your weekly reading list:

1. T2Impact’s Timothy O’Neill-Dunne tries to judge who’s right in the airline merchandising row.  Spoiler Alert: it ain’t the BTC.
2. American Airlines is trying to make GDSs, distribution channels to embrace XML in order to access ancillary services, which otherwise can’t be done prior to arrival at the airport.  However, American insists there will be no incremental costs to book via the direct connect channel.  GDSs probably don’t want to have to work through Farelogix, but also don’t want to modernize their feeds from EDIFACT to XML on a supplier-by-supplier basis.
3. Redmonk’s James Governor explains how VMWare isn’t getting into the relational database business, but that doesn’t mean they’re not in the database business.
4. First broken by BusinessWeek, it looks like Google is going to buy ITA Software for more than $1B, fully ushering in Google to the travel meta-search game (which they’re kind of in already with their recent integration of hotel results into Google Maps.  If this is true, it’s not good news for Kayak.com nor for Microsoft’s Bing Travel, the current leader in meta-search who also leverages ITA’s technology.  Good analysis on the rumor from Tnooz.
5. Altimeter Group’s Jeremiah Owyang breaks down the announcements from Facebook’s f8 conference.  Also check out Robert Scoble’s take on Facebook’s Ambition.
6. Does HTML 5 Herald The End Of RIA Plug-Ins? It’s behind the Forrester paywall, but I wanted to share it anyway.  It’s a pretty good analysis that separates the hype behind HTML5 from the reality that a lot of people have invested in RIA platforms and that HTML5 is still an emerging standard and therefore it will take a while to kill of RIA platforms like Flash.  However, the analysis doesn’t really take the rise of the mobile Internet.  I think it’s a pretty big miss and could act as a tipping point in favor of HTML5, but we’ll see.
7. HTC passes on Palm Buy. Not many options left. Lenovo? Motorola? Dell? My decision to by a Pre last summer is looking worse and worse.
8. Blippy offers a lame explanation of how credit card information ended up on Google. The “it’s less bad than it looks” line is the sort of non-apology apology that I have grown to expect and loath from companies and celebrities. What I’d like to know is whether Blippy went through PCI-DSS certification or if they even know what that is.
9. Apple tries to take over the travel industry next.  Great writeup by PatentlyApple.  But I’m not sure NFC will play as central as a role in reality as it does in the patent application.
10. 2 great posts by Don Dodge on what makes successful startups here and here.  Really nice to see him getting back to good content rather than shilling for Google.

One of the amazing oddities of the travel sector is the lack of adoption by traditional travel agents of modern user interfaces in travel reservation systems. It’s kind of funny that much of the software industry is debating HMTL5 versus Flash while the travel industry is holding onto a user experience that makes me reminiscent of working on a DEC VAX. Even at this week’s Travel Technology Europe 2010 show, I was flabbergasted to see new releases of software purposefully replicating the mainframe-style, hot-key oriented user interface that Global Distribution Systems (GDS) and Central Reservation Systems (CRS) introduced 30 or more years ago.

I struggle to understand the psychology of travel agents who cling to the old-style interfaces. Time and again I’ve read and heard of stories where they claimed that it makes them more efficient and that even new travel agents, many of which grew up using computers and the Internet, abandon the modern enterprise software GUI interfaces (a relative term since the GUI hasn’t changed dramatically in the past 20 years) to adopt a user experience which is one step removed from punch cards and stone tablets. At Travel Technology Europe I spoke to someone from one of the leading TMCs who used to be in operations and spoke enthusiastically and nostalgically about using the old-style interface indicating that she felt it gave her a sense of irreplaceability since it takes a while to understand the idiosyncrasies and nuances of the system to develop the speed that she was so proud of.

So I had a thought while participating in a discussion around the iPad: could touch be the technology that takes travel agent desktops out of the stone age?

Some of what I’ve heard is that as great as the different RIA (Rich Internet Application) technologies may be, it takes a long time to execute different searches and drill down into details. Touch should be faster than manipulating a mouse and if a layered “Minority Report” style UI brought up different search results using a cover-flow approach and you could tap on a property or flight and “flip the card” to see more details and to view photos it could match and potentially exceed current productivity levels and prepare the industry for further innovations.

Just a thought. What’s your take?