Leading international TMCs, online agencies and GDSs have come together to support plans to implement industry-wide technology standards for the booking, payment and reporting of airline ancillary services.

Airlines and agencies will be able to sell these products through the GDS. Corporate customers then will be able to reconcile the booking and payment of these products and their accompanying charges to travelers and their respective cost centers.

According to the recently released Amadeus Guide to Ancillary Revenue by IdeaWorks, worldwide air ancillary revenues leaped 43% from €7.68 bn Euros ($10.25 bn) in 2008 to €11 bn ($13.5 bn) in 2009.

Why it matters

• Facilitates purchasing Advanced purchasing could enhance the traveler experience. Rather than travelers hearing “Chicken or beef?” it is not inconceivable that once the facility for booking and accepting payment for a meal is in place, travelers could be enjoying restaurant quality meals during their business flights.

• Facilitate the capture of spend data Rather than some data on corporate lodge card and some on individual corporate card, some charged to travel, other charged to expenses, the total cost of an air ticket will be captured in one place. This data can be used to leverage negotiations.

• Inconsistency At present British Airways and Delta Air Lines are the only network carriers that have committed to this project. That leaves a lot of airlines without it.

• Widespread benefit Industry standards help both sellers and buyers.

• Policy compliance Extending the ability to purchase extras to bookers should increase compliance to policy on which extras travelers are entitled to use.

What to look out for in the future

• Potential price increases More disaggregation increases the number of items which can be marked up.

• Issues about what air revenues are relevant for overrides When ‘extras’ are being booked elsewhere they do not comprise the volume on which airlines pay overrides. Expect deep discussions between corporations and TMCs on the one hand and airlines on the other as to whether fees for checked baggage and seat assignment should count towards override targets.

• Rebundling Suppliers can reclaim some of the unbundled products and roll them back into their core product as an inducement for specific customer segments. For example, as part of a negotiated corporate deal, an airline might include checked baggage within the cost of tickets for any of the corporation's travelers regardless of whether the traveler was a frequent flyer or flying in a premium cabin.