Amid the changing travel technology environment and adoption of NDC, the BSP may gradually be replaced by new, more direct payment and settlement technologies. However, the pace of the BSP’s retirement would depend on controls for NDC content distribution, Ann Cederhall, Travel Technology Specialist at LeapShift told Travel News.
As a part of the GDSs’ move to remain key players, they were implementing their own NDC connections and APIs. Because BSP was closely tied to GDS distribution, the two were still linked, said Cederhall.
Airlines, meanwhile, are looking towards NDC and direct transaction channels as a way to reduce distribution and transaction costs.
“There are about 700 airlines and they are so incredibly diverse in where they are (with implementation of NDC). The one thing that they have in common is low profit margins.” If airlines bypassed BSP, it would gradually shrink, she explained.
“So, will BSP survive NDC? Well, that depends on who's going to control NDC.”
A gradual process
As airlines embrace NDC and direct ticketing, they are being forced to develop more advanced direct transaction systems. But with no standardised roll-out, direct distribution is showing cracks, as airlines struggle with the huge volume of tickets they now issue.
Speaking at the recent Asata Conference, Cederhall said: “I’ve been working with some of the models to bypass this system. I can tell you that the BSP really needs modernisation. So much of this industry and the systems it is based on are up to 60 years old. Shouldn’t we move to a world where the airline issues the ticket and the responsibility sits with them?”
She added that some airlines were looking towards modern banking and blockchain technologies in order to make direct transactions more efficient.
She said that some airlines viewed BSP as operating like a bank, and it had led to them asking whether they should move some of the system to blockchain and effectively become the bank themselves. “This will potentially disrupt the industry,” said Cederhall. “When you can have transactions that are actually on blockchain, they cannot be manipulated and it offers better security.”
Will NDC survive ONE Order?
Cederhall warned that even if NDC continued to support BSP for now, the coming shift to ONE Order would mark a turning point.
“BSP relies on the fact that tickets are issued, regardless of whether those are NDC tickets or GDS tickets. But the whole concept of ONE Order is that the ticket goes away and ends up in the order, so there's no need for auditing and there will be no need for BSP,” said Cederhall.
This eventual decline of BSP was set to disrupt the distribution and financial sectors within the travel industry, she said.
