Southwest expands distribution through NDC Exchange

Some Southwest Airlines customers will soon see expanded options when shopping for flights. The carrier announced today that it is joining the NDC Exchange platform, operated by ATPCO and SITA, modernizing the distribution of its air fares via the New Distribution Capability standards defined by IATA.

By joining NDC Exchange, Southwest continues its journey to make its content more accessible to business travelers in a way that’s easy to use and hassle-free. The carrier expects to complete its first NDC Exchange-based bookings by the end of the summer.

By partnering with NDC Exchange, we are making our API more accessible. This new addition to our no-cost multichannel distribution portfolio will drive consistency while providing the necessary functionality needed to support our Business Customers. Corporate Travel Managers and Travelers will have access to our everyday low fares and enjoy an easy and hassle-free experience from the same Southwest they know and love when booking via this channel.

– Rob Brown, Senior Director of B2B Strategy at Southwest Airlines

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For those hoping the change means Southwest fare data will soon be available on comparison shopping portals, this is not the case. While NDC Exchange opens up more distribution opportunities it also leaves the airline with “complete control over which sellers have access to its content” and the company will continue to focus that effort on the corporate travel space.

NDC Exchange is a specific implementation of the NDC protocols, managed by ATPCO and SITA. It enables airlines to connect with multiple sales channels – travel agents, aggregators, OTAs and more – through a single interface and without managing the direct connection relationships one at a time. It also includes technical support for the sellers of the product, further reducing the burden on the airline.

While the good news on this announcement is limited only to the corporate/business contracts where Southwest sells through 3rd party systems, there could be some overflow into the consumer channel as well. NDC enables greater access to ancillary products during the booking flow and eases the integration of other sales-related information. Easily incorporating rich content about the products from the Routehappy is one such opportunity.

Southwest Airlines is a welcomed new addition to the NDC Exchange family. We are seeing a steady growth of airlines and sellers alike to the platform, and with this continued momentum and more subscribers, the value only increases for the industry.

– Graham Wareham, Director of NDC and Partnerships at ATPCO

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Airlines are generally keen to realize the NDC benefits – namely lower distribution costs and greater revenue – as those also help the bottom line. There are some reasons, however, for consumers to be hesitant about the push in this direction. The personalized sales component of the NDC schema allows for fares to be targeted, just like ancillary offers and benefits. While that can benefit consumers in some cases the potential also exists for a consumer to be targeted with higher fares based on prior purchase patterns. Airlines suggest this is not likely to happen. At the same time, however, they are working to shift away from traditional fare buckets and tariff schedules for their pricing algorithms. The reduced transparency could work against consumers over the longer term.