competition issues

Jun 10, 2013

Forget batteries 787, IATA 787 is more dangerous

Imagine a world in which there were no publicly published air fares, the airlines owned and kept secret their tariffs, and using a variety of  spyware or monitoring technologies, offer

Ben Sandilands — Editor of Plane Talking

Ben Sandilands

Editor of Plane Talking

Imagine a world in which there were no publicly published air fares, the airlines owned and kept secret their tariffs, and using a variety of  spyware or monitoring technologies, offered you only the fares they thought you would be prepared to pay based on purpose of trip (business or leisure) urgency (flexible/inflexible with dates) and your capacity to pay (your individual wealth or that of your company, institution or known budgetary position of your government department.)

Among other things,  it would mean that on a full service airline you’d never know what the fare was going to be until you applied for one, after it then exploited what you might have thought was private information about your wealth, or lifestyle, or financial health of your company.

It would go way above and beyond the current situation , in which many fares would apply to the same trip, in the same cabin, and at the same time of day, something already seen where frequent flyer loyalty club members are raped en mass by programs that assume your loyalty means you are stupid or just don’t care.

Is this some throwback socialist fantasy (drag down the rich, but keep screwing the poor), or IATA attempting to circumvent open, competitive pricing and anti-predatory conduct consumer laws on behalf of legacy carrier mindsets?

You’re right, it’s the latter.

Welcome to the not-all-travellers-are-ever-going-to-be-treated equally desperation tactics and their culmination in IATA resolution 787.

However stories about resolution 787, as distinct from those about batteries 787, which something altogether different are rare in news reports (especially News reports) since they are grossly at odds with sucking up to advertisers, even the advertisers that are abandoning the over priced legacy media push promotional tactics for the self selecting pull media of social media followers in their personalized walled gardens of ‘likes’.

This one in Public Service Europe, published in English in Brussels, is different.

Here is a sample from that article.

In October 2012, large European-based airlines including British Airways, Lufthansa, Air-France-KL and American airlines signed up to a new system of flight pricing. This could leave some customers paying more than others for the same flight. With this new pricing system, fares will no longer be publicly available and customers would have to provide personal and sensitive data including nationality, age, marital status, travel history, shopping history and frequent flyer participation before being quoted the price of their chosen flight.

Instead of the current system, whereby fares rise and fall according to transparent factors like if it is a first or second class ticket or when the ticket is bought – this new system would take into account individual and personal factors that could end up being different to the person sitting next to you on the plane. It has the potential to completely overhaul the way customers book travel, giving airlines the opportunity to price differently for different customers including business travellers flying similar weekly routes.

Airlines have the potential to access a large amount of personal data just to be able to quote customers a price for a selected flight. Individual’s data would be collected and processed before even seeing the price of a flight. This would cause serious data protection and privacy concerns for individuals. The agreement allows for a huge shift from the current customer-driven, transparent model to an anti-consumer, anti-competitive system that will disadvantage consumers.

An archive of general and specialist media stories about IATA 787 can be found here. It was compiled by US retail travel lobby the Business Travel Coalition or BTC, and a rebuttal of the BTC’s reading of the IATA 787 can be found here on Tnooz, a travel trade website of some standing.

Readers are urged to study the IATA rebuttal as to the intent and purpose of its NDC or New Distribution Capability and draw their own conclusions as to whether or not this is an exercise in weasel words.

The issues raised by IATA 787 go to the much broader issues as to how the amount of information about consumers and organisations generated by IT and mostly what we give away about ourselves in our online data trails can be exploited in ways that are potentially grievously unfair or invasive.

But the very idea of air fares ‘going dark’ and forcing consumers and organisations to apply for a fare offer seems devastating in terms of blowing away the speed and convenience of making an on-line booking and receiving fair and equal opportunity to buy the best or most relevant fares of the day.

What is also astonishing about IATA 787 is how empowering it will be for the world’s most profitable carriers, like Ryanair, easyJet, Southwest and Air Asia, all low cost low fare operations that while despising each other, are united in their aversion to IATA, and its members, who are their prey.

It underlines the gradual loss of relevance of IATA. There is much to dislike about low fare carriers, but not when it comes to selling us fares quickly and without invasive and offensive background checks, and at least they do publish what they have on offer.

IATA 787 is the sort of exploitative processes that could seriously erode the routine use of air travel, and cause a major reconsideration of its use.

And its implications could hardly have escaped the attention of authorities such as Australian Competition and Consumer Commission the ACCC,  which would no doubt act once the risks to both competition and consumer benefit in this country become manifest.

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4 thoughts on “Forget batteries 787, IATA 787 is more dangerous

  1. Daniel

    Depressing read, also, “Your right” should be “You’re right” 🙂

  2. Ben Sandilands

    Thanks Daniel,

    And welcome to the misery of IT software that changes words intuitively in ways that makes users look even clumsier with grandma, I meant grammar, than they are. In WordPress, as in Word, you can sometimes think when you click to save or update that what you have written is what will appear. No. Sometimes if you get the timing a fraction of a second wrong, the intuitive or auto word correct function will incorrectly second guess the input and change it without your noticing it.

    Most social media users do not have sub editors. So if you are insufficiently vigilant or on the run the results at times can be awful.

    PS Just noticed on the original Word document on which this post was composed and then imported onto a WordPress template on-line, the words appeared as ‘You’re right’ from the start. But after pasting them onto the template they were changed.

    Immediately after publishing I usually spend 20 minutes or so removing unintended glitches. But some do get through, and of course, sometimes I’m just plain wrong.

  3. Geoff

    Ben – The internet is littered with “how to..” websites mainly dedicated to upsetting some smart idea to swindle or deceive the internet user (often) or the public at large (sometimes).

    I wonder how long it would be before:
    A – an airline broke from the pack and offered published air fares
    B – a competition agency somewhere busted IATA for price-fixing
    C – some smart computer users worked out how to always get the cheapest fare and let the rest of us know

    Not very long, I’ll bet

  4. Ben Sandilands


    Agree with ABCD and would add E, which is various states refuse to suspend competition law for IATA and F (for fail) which is IATA becomes even less relevant as consumers rush to embrace non IATA members including low cost carriers, which are eating their lunch in Europe anyhow.

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