The Evolution of GDS

As recently as the early 1960s, most travelers and travel agents made their reservations directly with their chosen airline, hotel, or car rental office via letter, telex, or telephone.  The growing popularity of air travel in the mid-60s forced airlines to establish huge reservation centers to handle telephone calls and also to develop computerized systems (GDS) to accept and store flight reservations.

    When a traveler (or a travel agent) telephone an airline, the reservation agent would use a GDS terminal to book the flight.  The traveler or travel agent would then make additional telephone calls to book hotel accommodations, a rental car, and the other travel services required.

    As air travel continued to grow, calls to the airline reservation centers increased dramatically.  To reduce costs and further increase their bookings, airlines began installing computer terminals in the offices of their most productive travel agencies.  Airline managers understood it would be less expensive to have travel agents book the reservations directly into the airline systems than it would be to hire additional staff at airline reservation centers.  They also knew that travel agents were more likely to book reservations on the airline that supplied the GDS terminals.

    Then the first in a series of GDS system content expansions were implemented to meet travelers' interests in comparative flight information and price quotes from a variety of airlines.  This first enhancement was the addition of inventory and fare information for other major air carriers.  Travel agents quickly realized that their computer terminals, with which they had grown comfortable booking airline reservations, could be a convenient tool for booking other travel services as well.  Their requests for additional options prompted the airlines to add booking capabilities for rental cars and, later, for hotels, and other travel products.

    Suppliers also were enthusiastic about the opportunity to present and sell their services to the thousands of travel agents using airline reservation systems.  It became clear, however, that those systems, designed to list and sell airline flights, were not structured for easy listing and selling of other travel services.  When the capability to sell non-air travel services were introduced, GDSs functioned only as electronic lists of availability and rates, with a booking capability.  Product and service descriptions in plain, understandable English, were not available.

    Hotels, in particular, require display formats that can present a wide variety of room types, complex rate structures and detailed text descriptions that effectively portray a property.  Car rental companies face similar challenges in adequately portraying their fleets, rules, and booking opportunities.  Nonetheless, the potential of the distribution opportunity was immediately apparent and non-air supplier companies became major participants in airline reservation systems.