Cathay Pacific Signs for Amadeus Altea – Who Will Win?


A quote from the news:

Cathay Pacific signed a 10-year contract with the airline IT provider Amadeus. Cathay Pacific and its subsisdiary Dragonair will adopt the complete customer management solution Altea for reservations, managing inventory and departure control.

Cathay Pacific Airways, which already uses Amadeus’ internet booking engine to power its commercial website, has identified IT as a core component of its strategy as it seeks to expand operations and continue to grow in some of the world’s fastest growing aviation markets like China, as well as the US and Europe.

According to Hans Jorgensen, Vice President, Strategic Airline & Partner Programmes at Amadeus: “As one of the world’s most successful airlines, in terms of both profitability and growth, we are delighted that they have selected Altéa CMS as their customer management system.”He continued: “We believe that Cathay Pacific’s decision as the first Asian carrier to choose the whole Altéa suite of solutions, will be viewed positively by other airlines and catalyse growth for Amadeus in the Asia-Pacific region, as a leading IT provider in the travel industry.”Cathay Pacific Airways and Dragonair, who together carried 22 million passengers in 2006, join 42 airlines across the globe that have selected Altéa CMS.

Who is lucky?

Again a oneworld member that was given the right to implement the full Amadeus Altea solution, probably within a reasonable timeframe (however, the news do not state when the planned cutover will take place, Amedeus first has to deal with LH, AF and KL among others…). Believe it or not it is not the supplier who is lucky here. Amadeus – chosen by the 3 major airline alliances – is on the right track to become the number one IT provider in the industry and thus rule the world of airline IT providers. The airlines need a common platform for passenger handling more than ever. Major IT providers (Galileo, Sabre, Worldspan, SITA and others) gained some market in the past 20 years, but the future will not see them as players in the market if they will not change their strategy. The problem is that free data transfer is more important for airlines than prices. But there is no free data transfer between different GDSes, DCSes and inventories, so the only solution left for them is to pick one and use only that. At the moment, Amadeus is the only one that offers the full suite of airline solutions, in an integrated package, which has been rolled out almost completely already and is working at some airline customers, as we speak.

Amadeus was chosen very rationally by oneworld, then Sky Team and Star Alliance followed them, too. They have already ruled the European market and now they are on the way to Asia.

So how can other providers win some clients for themselves?

There is still a field to play. Amadeus has 2 very tough weaknesses, which can be an opportunity for others. One of these weaknesses is that they do not have the capacity to start more new projects, therefore airlines cannot sign up with them, they would simply not receive a “slot”. This is why I wrote Cathay was the lucky winner here, because there is a huge queue of airlines wanting to adopt the Altea technology. The other weakness is the huge and a little bit chaotic organization. There are too many managers and not enough real working hands, therefore production is less effective. We have been to meetings, where there were at least 20 people sitting and nobody knew what his or her task will be in the project. Of course later about 5-6 people had real tasks. There is one more good thing that other system providers can use: the Amadeus API. You can basically do whatever you want with it – there are a few system providers that already did that actually. You just have to know the system. Summing up if I were one of these providers, I’d put all my cards on offering solutions to airlines that serve their data exchange needs by interfacing Amadeus (as well as my own solution – if I have one) and give them a very similar, integrated solution for GDS, inventory and DCS and I would give them deadlines that are acceptable. I would also provide personal consultancy and good customer relations, in which Amadeus is also not the best due to being overloaded with new customers. If I were another provider on the market, I would also offer some tailor made enhancements/modifications, which Amadeus usually refuses to do – due to the high overload again. But I would also need a working solution to compete with Amadeus, “slideware” presentations would not do the trick… Whoever has that at hand, will win.

By Szafi
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1 Response to “Cathay Pacific Signs for Amadeus Altea – Who Will Win?”


  1. 1 Yvonne Pascal September 23, 2010 at 2:44 pm

    Please send regular updates by email for this website
    Thanks


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