Case Study

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Abstract Advantages for airlines to control ticket distribution are apparent and ongoing. The three major distributors of airline tickets are Travelport, Sabre, and Amadeus and many airlines aren’t happy with the way these distributors are charging them fees to sell the tickets. Airlines like American Airlines and Delta claim that these distributor websites are quibbling over money with them for fees that these airlines have to pay in order to use the ticket distributors’ services. Each time a customer buys a ticket online, one of the three distributor charges that airline fees. Tens of millions of dollars a year are spent by airlines having to pay these distributors’ fees. For decades, airlines have been working to abate this system of paying the distributors for each ticket sold. In addition, other airlines are in the same boat with American and Delta and want to skip these online ticket distributors to utilize only authorized travel agents or their own airline’s websites to sell tickets for flights. The online ticket distributors are countering these airlines fight against them by claiming that these airlines are trying to create their own monopolies by only allowing customers to buy tickets from their own airline websites or approved travel agencies. The system that is currently in place is that a travel agency uses any one of these three ticket distributors to locate the flight and prices that the customer desires. Once the agency books that flight, the distributor is paid a fee because it provided that agent or agency with the ticket and itinerary. Many airlines don’t like this system and want to eliminate the need for using any of these three ticket distributors. Some airlines are worried that these distributors could easily exert market power and strong-arm them because majorities of airlines are still highly dependent on them for getting

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