Technologies such as cloud computing and Big Data, and non-traditional players like Google promise to transform the travel landscape, with profound implications for Global Distribution Systems (GDS), airlines, OTAs and travellers. Here's how:
Cloud Computing and Big Data:
Cloud computing and Big Data are poised to create a paradigm shift in the travel industry. In an IATA report1 it is predicted that through an alternative distribution model and Big Data analysis, airline websites will produce 59 percent of their booking volume, up from 35 percent as of 2012. This report further states that any technological company like Google and Amazon that had mass reach amongst consumers through devices, and had Big Data on spending trends and travelling habits, was poised to change the distribution model for airline ticketing.
Big Data holds the next step. True personalization is what all travel agencies and airlines are pursuing. Imagine a world where a travel agency is able to suggest the exact hotel that will suit your needs rather than throw you a plethora of generalized suggestions that are no good. It will be able to do this based on two things – your travel preferences and your historical habits.
Proliferation in smartphone technology means that an operating system is constantly aware of where you are, what you're doing, what you're searching for on the internet, and which of those products you actually end up using. This mine of information can easily be used to generate what the Big Data industry calls 'true preferences'. We already experience a sample of this when we use search strings on Google.
Google made its entry into the travel industry with its acquisition of ITA software and then launched Google Flights and Hotel Finder, flight and fare search features linked to the Google Maps API.
Google is investing heavily in fare-search technology through metasearches. It is building up a communications ecosystem using Google Flights as an experimental base. Using its Maps API, the next step will no doubt be to merge all these together. What will we get? A single tool that knows you and your travel habits, is aware of your spending capabilities, is clued in on your likes and dislikes, is aware of your schedule and your appointments, and has the power to get you the best deal possible by talking directly to airlines and cutting out all other middlemen.
Furthermore, as per an independent report2 Google's mobile OS penetration and reach through its search portal has massive implications for the travel world. Also, it has been reported that Google has the power to customize what passengers want. This is currently something that no travel GDS can do. With Big Data at its fingertips, Google can probably rope in carriers and suppliers to use its own metasearch capabilities and cut out GDSes with this direct connect model. Google's capabilities with Google BigQuery (its Big Data analytics tool) and its vast cloud capabilities means it already has a stronghold in the technologies that will matter the most to the travel industry.