IATA’s New Distribution Capability (NDC) standard promises big change, but airlines face complexities in implementation. Here’s how the community can begin to embrace it quickly and cost-effectively.
With the airline industry’s move beyond selling on the web and into other channels, distribution strategies have come to entail many different ways of communicating and using Application Programming Interfaces (APIs).
IATA’s New Distribution Capability (NDC) aims to bring order to that communication conundrum – enabling airline products to be represented in all selling channels in the same consumer-friendly way.
According to Graham Wareham, Head of Distribution Portfolio for ATPCO, the airline-owned platform for content distribution: “NDC is really a set of non-mandatory standards developed to assist the adoption of an API distribution strategy.
“In essence, it’s about airlines gaining better control of their interactions with customers, and a richer conversation about the airline product.”
For the airlines, then, the obvious lure of NDC is the command they’ll wield over their product and the customer experience, with the assurance that all components of their offer – schedule, fares and availability – are presented in a clear, complete and consistent way no matter what channel they’re distributed through.
“That’s the big change,” says Wareham. “In an NDC environment, customers can continue to shop where they choose, but the real transformation is all about the richness of the product that the airline gets to offer via their chosen channel, and the consistency of those products. It means that wherever a customer looks for an airline's product, it’ll be the same.”
ATPCO’s Head of Product Development, Bryan Trauger, agrees, emphasizing that consistent brand representation is a need that all carriers are looking to satisfy, in addition to delivering a single customer experience.
“This is one requirement and challenge but there are others too,” comments Trauger. “Airlines need to ensure all points of sale are being served in this consistent way, and on top of that, they need to cater for the ever-growing number of message standards and versions in use today within the industry.”
Currently, around 30 different messaging standards are in operation. These include Open Access, Open Travel Alliance, and IATA's NDC standards. “And even on the same version and format, say NDC Schema 17.2, carriers may actually implement differently,” adds Trauger.
“For example, ‘carrier A’ may use one set of elements, while ‘carrier B’ utilizes a completely different set. Added to the three common standards is the fact that some airlines utilize their own proprietary message standard.”
NDC could require hundreds of connections, which can be complex to set up. A community approach overcomes implementation challenges by enabling just one connection to the service, which through an API interface gives access to everyone in the community.
In this environment, faced with the multiplicity of communications and standards, connecting to more than one carrier necessitates the implementation and support of many formats and versions. This creates significant implementation costs, not to mention time spent creating many solutions.
“NDC could require hundreds of connections, which can be complex to set up,” says Thad Barringer, SITA Community Messaging Portfolio, Americas. “And the challenge is compounded as the scale expands.”
That challenge relates to onboarding, the airline’s process of bringing a new seller into a direct channel. Even for airline-to-airline connections, which might be relatively few (say 10 to 20) for some direct interline or direct partnership type of sales, there will still be challenges.
It involves numerous people, as well as setting up a process, establishing different network setups and the long-term maintenance of all those connections.
“This takes great deal of time and effort,” adds Barringer. “So think of how that escalates for airlines-to-sellers, where the connection numbers go into the hundreds and even thousands.
“Each supplier airline needs connecting to every seller, so it's easy to see how this model quickly becomes both complex and not cost-effective. There’s also a multitude of NDC schema versions, and the fact that not everyone is going to be on the same version or does not transition from one version to another at the same time.
“And of course on top of that the airline needs to be thinking about security and data privacy, two challenges that are on the top of everyone's list these days.”
The initial steps for an airline reseller moving towards NDC implementation involve setting a connection strategy and ensuring interoperability with initial target NDC partners.
Going it alone means establishing multiple connections and supporting all schema versions, with the consequent complexities that would baffle even the most sophisticated of airline IT teams.
Another major step is to verify the end-to-end transaction and business process, to be sure that the approach is in fact going to result in successful sales.
And of course, there’s the planning and preparation necessary to ensure interoperability, custom integrations, deployment, security and scalability. Each of these presents significant implementation hurdles.
The alternative to going it alone is to join community initiative, such as NDC Exchange from SITA and ATPCO, which is building an NDC community.
NDC Exchange overcomes implementation nightmares by enabling just one connection to the service, which through an API interface (of the seller or airline's choice) gives access to everyone in the community.
Such a community approach enables interoperability between different NDC implementations, such as various schema versions or between NDC and a specific airline's proprietary API. The NDC Exchange acts as translator into one common industry-wide language.
Air Canada’s Director of Global Product Distribution, Keith Wallis, is a proponent: “NDC Exchange was the perfect fit for Air Canada. It allows us to work with a partner that we trust, it allows us to innovative quickly, but it also allows us to be conscious of an IT budget.
“We are, after all, an airline, not an IT company, and it's important for us to pick partners who can help us within our budget, get the innovation we need quickly.”
The industry really needs this collaborative approach to providing a solution that’s scalable and works for airlines and travel sellers, in order to bring the NDC standard to life.
ATPCO’s Wareham again: “The industry really needs this collaborative approach to providing a solution that’s scalable and works for airlines and travel sellers, in order to bring the NDC standard to life.
“This will enable the industry to work in dual-distribution mode for many years, as some airlines will want to adopt maybe a few components of NDC, while some will want to remain rooted in the traditional distribution model.”
NDC Exchange facilitates the adoption of NDC while maintaining deep roots into the traditional distribution model. Airlines and sellers can advance their industry programs at the pace that best suits their business needs.
“Working solely in just one of these distribution models is easy, but working on both is very difficult. So the two distribution channels will need to be interoperable for a very long time to come,” says Wareham.
“What’s clear is that a community approach will make NDC much easier and more cost-effective for the airline and travel industry to embrace.”
“There are three main key benefits that I focused on when I look at the NDC Exchange,” says Keith Wallis, Director of Global Product Distribution for NDC launch customer Air Canada.
“Quickly becoming NDC certified, protecting us from the multiple versions of NDC that are out there, and allowing us, really, to work with any partner on their terms.
“But maybe most importantly, future-proofing our solution is important for Air Canada. It is a cost-effective solution that the industry can leverage. It's run by partners that we all know and trust. That's why it's not just a solution for Air Canada.
“We see it as a solution for the whole industry, which is why we've chosen it. That is why I think it is something that everyone should take a look at.”