Amadeus, the leading provider of technology for the global travel and tourism industry, is looking to expand its IT services to related businesses, particularly airports in Asia Pacific, to tap the growth in travel in the region, says David Brett, president for Asia Pacific.
Airport operations is an area that Amadeus believes to be in need of efficiency improvement in order to provide better services to travelers. He said Amadeus was in talks with a number of airport operators but he declined to name them.
“I do believe that airport operators are preparing to improve their services, and advanced technology can help them fulfill this job. Service in airports has to be more efficient and there is room to do so,” he said.
Amadeus has provided IT systems for airline ticket booking since 2004 in addition to the global distribution system (GDS) business, the reservation tool that agents use when making an air, hotel, car or other travel service booking. The company has allocated 2 billion euros for research and development (R&D) to develop infrastructure for its IT solution business.
Many airlines, which used to have their own IT systems for managing sales, air ticket reservation, inventory and departure control functions, are now outsourcing this work to Amadeus. As a result, airlines can reduce their operating costs in hiring IT employees, maintaining and improving IT systems, which are increasing every year. For its part, Amadeus can gain further advantages over other competitors as the company is now the service provider for airline IT systems.
The synergy between the GDS and IT businesses has enabled Amadeus to grow rapidly, as seen in the increased market share for its GDS business. Its global market share as of June this year in air ticket bookings was a world-leading 38.3%, up from 37.2% in June 2011.
Amadeus IT Holding, the parent company of Amadeus Group, recorded profit for the first half of this year of 332.5 million euros, an increase of 26.1% from the same period the year before. The revenue during the first six months of this year was 1.5 billion euros, rising by 8.6%.
Revenue from distribution business grew by 7.2% to 1.157 billion euros, while that of IT solution business rose at the higher rate of 13.6% to 351.4 million euros. The revenue proportion of IT solutions to Amadeus’s total revenue is 23.5%.
Mr Brett that airport procedures such as check-in and immigration screening were time-consuming processes. Good IT infrastructure can help shorten times, facilitating better service for travellers.
Amadeus started offering IT solution systems for airlines in 2004, but implementation is time-consuming and Qantas was its first customer to go live with the system in 2008. The company continues to seek new clients, particularly in Asia Pacific.
“In the near future, we expect 80% of passengers travelling in Asia Pacific will be those who use our service,” said Mr Brett.
He added that Asia Pacific was a key area of growth for Amadeus. It foresees a lot of intra-regional travel, driving by the increasing number of middle-class consumers who can afford to fly. Southeast Asia is a relatively compact region, and air travel is appealing for intra-regional holidays or business trips because most flights take less than three hours.
“Travelling in the future can be arranged at the fingertips [of Southeast Asian people],” said Mr Brett. “And we will build the good IT infrastructure to make their journeys more convenient.”
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Writer: Nalin Viboonchart