Travelport President And CEO Talks Privatisation, NDC And Innovation

Transcript

Gordon Wilson:Travelport's moved from being a publicly traded company listed on the New York Stock Exchange to being taken private. So in a transaction valuing the company at $4.4 billion, we've been bought by 2 private equity companies, Siris, who's based out of New York, and Evergreen Coast Capital based out of California. So I think this is actually quite a good thing for our company because in a world of all the change that's going on in terms of the flows of information and technology, you know, in terms of AI, big data, cloud computing, NDC API, etc., Travelport adapting to all of those changes in a private world is probably easier to do than doing it in the public, you know, quarterly earnings cycle world. And With our new owners who are technology investors first and foremost, they kind of get what's happening in the industry and what the kind of investments as a company we need to make are, and they can take a longer view than a quarter-to-quarter view which some public shareholders tend to have. So this is a very positive development, you know, for our company. We're pretty excited about it, and we closed that transaction last Thursday. So we delisted from the New York Stock Market, now we're privately owned. Apart from that, however, it's very much business as usual. The main things that Travelport are working on is all our work around NDC. I think, as you may know, we were the first GDS to get certified at Level 3 by IATA in terms of an aggregator, and in fact we then went on to be the first GDS to ever process an NDC API booking. So now it's all about scaling that up. So we are working with a number of pretty large airlines in terms of how to bring their NDC content into our platform and our system based off the work that we've already done, but to do it at scale and to address all the process workflows that take place as well. Because the important thing about NDC is NDC is just a protocol in terms of how you exchange information. It doesn't sort of give all the answers to actually how you then manage workflow automation and processes. How do you deal with changes to bookings, particularly in corporate travel, which change quite frequently? How do you get the data that you need as a corporate travel manager or corporate travel buyer or a TMC to sort of adapt to this changing world. So whilst we've changed ownership, it's not a case of changing strategy, it's a case of going faster under a private-owned world than in the public world. And that NDC adaptation alongside what we're doing with the shift to mobile, because Travelport handles about 200 million passengers' worth of airlines who use our mobile apps from Singapore Airlines to Etihad to easyJet, etc. And we're putting our mobile apps out into the travel agency community as well. So that fast adaptation of improved mobile technology as a means of engagement with customers, a means of booking, a means of process changes, changing bookings, etc., is a key part of what we're investing in at the moment and bringing new product to market. Products like SmartPoint, which is our agency point-of-sale system, the biggest change agencies have already seen in SmartPoint is that now with about 300 of our 480 airlines that are fully bookable in the system, We have full rich content and branding with them, and in our world what that means is the airlines can show their complete range of fares families. They can show pictures, they can show descriptive text, they can show you how much it is to trade up to each product, as well as all of their ancillaries, whether that's seats, bags, pre-ordered Wi-Fi, pre-ordered meals, or whatever. We can do all that for 300 airlines, representing well over 70% of all the bookings made in Travelport today, and Smartpoint is the agency point-of-sale desktop that does that. What we're adding to that is enabling through our API sets, i.e., the APIs that we give to corporate self-booking tools and to online travel agencies, through our new generation of APIs, we call them Trip Services, the ability to get all of that content through those APIs which are JSON and RESTful, which means they're lighter weight, they're faster in terms of processing. And the feedback we're having on that next generation of APIs is very encouraging indeed in terms of the speed and the quality that airlines and agencies are getting. And for the airline piece of that, what it's enabling them to do is to get the online travel agencies to enable the offer to trade up, to merchandise up. The customers come in saying, you know what, I'm interested in this product with this airline at, you know, $200, to sort of trade that customer up, if that's what they want, to the $350 product or whatever else the airline is offering. And that's all done through our Trip Service API suite. Travelport's always been about, you know, providing to agencies the richest stream of content possible. And of course what's happening is that the nature of that content is changing, has changed already. So that's why, again, with 300-odd airlines with rich content and branding, but now adding to that what we can do in the NDC world as we roll that out as well, is making sure our agencies have the full range of content that's available and that the agencies can demonstrate their value to the airlines in particular by showing that they have actually caused a customer who came in at price A to leave having bought price B or C, which is obviously more where the customer wants it. In addition to that, it obviously is all the stuff that we do in the corporate travel world, which is how we manage all the negotiated content that a particular corporation may have, so their negotiated fares, all the special deals they have with a particular airline, all of which can also be done through our merchandising platform in Travelport alongside the NDC capability as that continues to progress and evolve. The airlines have always direct marketed to consumers and will continue to do so, and wherever possible as an airline you'll try and get customers to come directly to you for a variety of reasons. Once, A, if you get the customer to your website you've got more chance of them just buying your product. The point is though that a lot of consumers want to see choice, and a lot of consumers want to compare and contrast the offers of multiple airlines, and that's why they go to travel agencies or Those consumers are actually corporations, and they use a travel management company to manage their corporate travel program, which seldom involves just one airline or just one hotel chain or whatever, but multiple airlines, whatever they've got deals with, and also has things like duty of care and data reporting and benchmarking, etc. All of that activity is basically done through the GDS capabilities that we provide to our customers. So in a way, all the NDC does is sort of give an additional, in many cases, stream of data with with different content which will progressively come through. Today there's little that's really different in NDC, but, you know, the plans are that there'll be more tailored offers coming to corporations through NDC over time, and we are ready and able to accept and deliver that content onto the mobile apps or the point-of-sale apps or the call centre capabilities that the TMCs are using to service the corporate customer. Yeah, hotels are a very interesting area because today in Travelport we have 650,000+ hotel properties bookable. So we've always done a very good job with the hotel chains, and what's emerging there is that we're moving all of those hotel chains, just as we are with the airlines, to the next generation of connectivity, XML-style connectivity with them. And those big hotel chains are trying to do the same thing that the airlines are doing, which is basically getting the customer or making offers to the customer or getting the customer to trade up to the next product that they may want to offer, a better room. Or a better view, or a room that includes a discount at the restaurant if you have your dinner in the hotel, etc. All of those things are causing us to adapt our system to bring that content in. And then the second piece of that is the independent hotel sector, where we led the industry basically in aggregating the aggregators, so getting all the content that hotel bed banks and the likes have and putting that content into our system so that travel agencies and indeed customers themselves through mobile apps can book that hotel content. And the great opportunity here is that on average, you know, an air booking in our system is made something like 30 days in advance of the date of travel. A hotel booking is made 10 days in advance of travel. So between day 30 and day 10 to travel date, there's lots of opportunities to sort of cause the customer to attach some other form of content, whether it's a hotel or it's an experience in a destination or whatever, to the booking. And more and more that's taking place in the mobile. At World because that's engaging the customer tailored to the itinerary, the air itinerary they've already bought. So that's a huge opportunity of growth for us as a business.

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