Travelport Rounds the Corner on New Platform Migration

Travelport's Greg Webb and Tom Kershaw Discuss:

• The U.S. as the last frontier for Travelport Plus migration
• Why NDC bookings as a proportion of total volume remain low
• Global opportunities with Deem

More than two years after launching Travelport Plus as a unified platform to replace its three legacy global distribution systems, Travelport is getting closer to full migration across its customer base. At the same time, the technology company recently completed the integration of Deem within the Travelport Plus platform, following its acquisition of the booking technology earlier this year. Travelport CEO Greg Webb, along with chief product and technology officer Tom Kershaw, spoke with BTN executive editor Michael B. Baker during the recent Global Business Travel Association annual convention in Dallas about progress on both of those fronts as well as opportunities and challenges presented by the New Distribution Capability standard for airline distribution.

BTN: How far along are you on the migration of customers to Travelport Plus?

Greg Webb: We're actually really pleased with what's happening on the upgrade path for customers to Travelport Plus. For the most part, everywhere outside of the U.S. is upgraded with really positive feedback across the board. We intentionally started other places. We have a bigger strength in Europe, so we started there first, in Europe, the Middle East and Africa, and progressed and knew we were going to finish with the U.S. We're making really good progress in the U.S. on the upgrade side. We're about 60 percent done with the larger agencies here. We'll be done in the next 18 to 24 months. It comes with so many benefits. When you start thinking about a next generation of modern retailing and the ability to do things like integrated search between traditional content, low-cost carrier content, [New Distribution Capability] content all on the same platform, you get that with Travelport Plus. There's just a lot of tangible benefits to be on the platform. We're not having to push it that hard. It's more of a pull. 

BTN: Concur also just announced its new booking experience will be available through Travelport. What's the timeline for that?

Webb: It's been really a more technical discussion for the last bit of time. They're making changes to their platform, we've got Travelport Plus as our new platform, and it's trying to figure out how those two things will integrate. We finally figured out our timeline and have already started working together. We feel good about making sure we put that out in the early part of next year.

BTN: What are some of the highlights of Travelport's recent content announcements?

Webb: We just launched BA on the NDC [rollout]. Our negotiations with airlines are not dissimilar to the negotiations we had with airlines a decade ago. It's about delivering the maximum benefit to the buy side, and that means we need to be the best multisource content aggregator out there. If that's traditional ATPCO/EDIFACT content, or if that's NDC content, I'm indifferent to that. I do think we provide huge value to the supply side in that we bring a very diverse set of customers and a great reach. 

BTN: How has NDC been going for Travelport and what’s on the horizon?

Webb: The structure of NDC is now a decade old. The original intent was to create a technical standard for the industry to deliver a different way to transact on this super-new technology called XML, which is now 30 years old. We agree with that idea; a new technical standard sounds great. The problem is that every airline implements it differently, so it's not a standard. It's the exact opposite of a standard, and that causes complexity across the board.

We found a very clever way to deal with this. Tom has been working on what we call the content curation layer, that allows us to take disparate content, normalize, reduplicate it and deliver it in a way that's actually buyable. NDC started with the promise of being better for everybody, a better way for suppliers to sell, a better way for us to distribute and a better way for agencies to interoperate with that content and their customers and, for the consumers, a better buying experience [that would be] more personalized, different offers, things that were a true benefit to them. So far, that has not played out.

BTN: Other GDSs have reported that NDC is making up a small percentage of their total volume. Is that the case for Travelport?
Webb: It's extraordinarily low volume, and not because we haven't made it available. Including our competitors, all three of us have spent tens of millions of dollars to build out the technology necessary to deal with the un-standard nature of what's been produced so far, so we're all making the content available. There's just nothing special to it. It's not like all of a sudden the consumer says, "Wow, if I buy that, it's rainbows and everything's great." It's pretty much the same product.

Tom Kershaw: There are huge coverage gaps too. NDC only covers short-haul, usually domestic, single-hop stuff, and most customers want a single source of everything. They don't want to have a different way of doing certain route pairs, so until it gets more mature and has more universal coverage, it's going to continue to be small. There's no interlining, no codeshares—those are pretty big gaps.

Webb: Imagine a traveler buys a ticket that happens to be an NDC ticket, and then they need to change their flight and are told by the agent on the phone, "I can't change that flight because you have an NDC fare and all I have are EDIFACT fares, so I can't exchange those two." You think an end traveler understands the difference? It will continue to get better, and we will work diligently with all our airline partners to make it as effective as possible and try to deliver something that provides value to the end consumer. When we finally figure that out as an industry, I think you'll see more volume.

Kershaw: In theory, if every airline is competing for your business on every search with the most customized, specific offer they can provide to that traveler, that's a good thing. There's just a lot of technical challenges. Seamless servicing is the single biggest issue. Is it worth a $10 cheaper fare if you have to wait on hold for an hour to exchange it? Most business travelers would rather pay the $10.

Webb: The challenge is helping the business traveler understand that tradeoff at the point of sale. They'll get it after the fact, but how do you communicate that?

Kershaw:  And do you want them to make that choice or make it for them? Empowering the agent to make the right call to what that subscriber really wants is what we're all about. It's giving the agent those tools.

BTN: It seems like a similar challenge to getting travelers to understand restrictions around Basic Economy fares or nonrefundable hotel reservations.

Webb: Part of getting to a modern retailing platform is making sure we are presenting information in a consumable way so agents can explain to travelers and those who use our APIs can present content in a way that allows consumers to go, “I understand I can get this for $200, but then I have to pay for these things on the side, or I can get this for $250 and get all I need. Which do I want?” … The other part is making sure that it's in the right place in the booking process. You don't want to get to the end of the booking process and see $75 in additional fees. You need to know upfront in the search process. That's what Travelport Plus and Smartpoint Cloud [storefront] do, is push it up in the buying process so consumers can make good decisions.

BTN: We've talked about air and hotel, but what's happening in rail?

Webb:We've done the integration with Trainline as well as our normal rail connections. We do see rail as an ongoing, growing part of the travel ecosystem, especially with the push on sustainability. You've seen several European countries that have implemented regulations around eliminating short-haul flights that can be covered by rail, and I think that will continue.

Unlike the airline industry that was forced a long time ago to get semi-regulated in terms of some standardization in how things work cross border and things like that, there is no real rail standard. [Belgium's] SNCB works different than [France's] SNCF, which is different than Deutsch Bahn, which works different than the UK rail system. One of the things that could benefit the rail vendors it to try to come together and come up with a unifying standard around the way all those things work.

BTN: How is the Deem strategy progressing?

Webb: One of the first things we did was a little market research, asking around. The thing we continually heard was Deem has by far the best user experience, the best mobile experience and the best desktop experience. We started looking under the covers and saw they have some good technology. We [are working toward] a deep integration with Travelport [to] make sure they can take advantage of our underlying technology, our NDC integration for example, so there's no reason to duplicate things we're already doing and simple stuff like [integrating] their data center into our data center. [It’s] a compelling value proposition to put the two together. 

BTN: Deem has worked with all GDSs up to now; will that continue?

Webb: We're still going to be GDS agnostic with Deem. We have Amadeus customers and Sabre customers on Deem, and one of the things that is next on Tom's list for Deem is to do some Sabre NDC integration. We're going to continue to keep pace with the other GDSs, but we think if you're a customer of Travelport and a customer of Deem you're going to have a better experience. We're only about 120 days in, and so far, everything has gone exactly to plan. During due diligence we were nothing but thrilled with the people at Deem. It's a great team: really ambitious and a really good understanding of the industry.

BTN: Where are you looking for user growth?

Webb: Deem has been underutilized on a global basis, so global expansion is going to be the next step. When they got acquired prior to us, the focus was entirely U.S.-based, despite the fact there were some natural abilities to easily get outside the U.S. We have customers who use Deem entirely in the U.S., and they're effectively forced to use a different online booking tool elsewhere. [They are] saying, "If you would just make this available to me in these three countries, I will move those three countries to Deem tomorrow." We've started down that road, but obviously it won't happen overnight. We've identified 60 countries where it will be relatively easy to expand our footprint.

BTN: Will you be looking at other acquisitions soon?
Webb: We'll continue to be cautiously acquisitive. If there's something that looks like a natural extension to Travelport Plus, something our customers would see as a good tie-in and natural benefit to their business, we would certainly look at that. Our strategy is not to grow by acquisition, but we would be opportunistically acquisitive.

BTN: Will Travelport stay in private ownership, or would it look at going public again?

Webb: It was certainly an advantage during the pandemic to be private. We have very supportive sponsors, so our owners have been ridiculously supportive of the company. The fact that they were willing to step in and make sure we could continue to perform and grow during a time we really could have had to cut Tom's technology budget, we came to an agreement with our sponsors that we will continue to invest in Travelport Plus. We'll cut other places, but we'll continue to invest in the technology, because that's the future. That was a huge advantage.

The company has the perfect profile to be a public company, and if you look at the transformation we've gone through, it's significantly better than in 2019, when it went private. We've gone from being a company that had been a share donor to being a share gainer. We went from being a little scattered in terms of technology direction, back in the mid 2010s to 2018 or so, to being very focused—and we think leading—in terms of where we're going. … That was all because being able to be private and continuing to invest, when maybe the public markets wouldn't have understood that. I only had to explain it to my board, not a thousand people. Going forward, we'll see, but we're not in a hurry to do anything. We're pretty happy where we are.