ATLANTA, April 13, 2011 /PRNewswire/ -- Travelport, the business services provider to the global travel industry, today announces that it intends to vigorously defend against a ludicrous and meritless antitrust lawsuit filed by American Airlines (AA) in Fort Worth, TX.
AA's antitrust complaint contains significant factual inaccuracies, including, for example, wrongly stating that Galileo, a Travelport GDS platform, operates in the United States -- which it has never done. There are also many disparaging comments about Travelport's technology which are not borne out by facts including recent airline adoption of Travelport's merchandising capability or innovation such as the ground-breaking Travelport uAPI.
The complaint also finds fault with Travelport/AA's longstanding distribution agreement -- through which AA benefits from significant discounts -- some five years after its initiation and at a time of renewal.
In unsuccessful negotiations and now in litigation, AA seeks to limit consumer choice in shopping for fares and to limit consumer access to other relevant data. Travelport's aggregation, search and shopping allows travel agents and consumers a full range of choices across over 400 airlines. Travelport believes that AA's plans to force a more restrictive distribution model would result in inefficiencies and considerable added costs ultimately to be paid by consumers.
Travelport believes this lawsuit is merely another attempt by AA to gain bargaining leverage through litigation. AA's unfortunate choice to litigate frivolous positions, rather than engage in fair and constructive negotiations, leaves Travelport with no alternative except to defend these claims vigorously and to take all appropriate legal action.
Notes to Editors:
- According to Travelport estimates, only 13% of all airline passengers boarding flights in the United States purchased their tickets through Travelport's GDS travel agent subscribers. These subscribers earned an average distribution fee of (1.2%) less than 2% of the average ticket price. In comparison, the average distribution expense for a US hotel is 1.5 % of the cost of a stay.
- Over the last five years, Travelport estimates that the distribution prices paid by US airlines to Travelport have declined by 18%. On a real or inflation adjusted basis, distribution prices charged to US airlines have declined by 24% over the last five years.
- Google, Bing, Yahoo!, and Kayak are strong new entrants in the distribution of airline tickets. Their business models often bypass GDS distribution in favor of directing consumers to airline websites.
- AA made no mention of any material impact to the company as a result of any action by Travelport in its most recent earnings release to investors and in its regulatory 10-Q filing.
About Travelport (www.travelport.com)
Travelport is a broad-based business services company and a leading provider of critical transaction processing solutions to companies operating in the global travel industry.
With a presence in 160 countries, approximately 5,475 employees and reported 2010 revenues of $2.3 billion, Travelport is comprised of the global distribution system (GDS) business that includes the Galileo and Worldspan brands; GTA, a leading global, multi-channel provider of hotel and ground services; and Airline IT Solutions, which hosts mission critical applications and provides business and data analysis solutions for major airlines.
Travelport also owns approximately 48% of Orbitz Worldwide (NYSE: OWW), a leading global online travel company. Travelport is a private company owned by The Blackstone Group, One Equity Partners, Technology Crossover Ventures, and Travelport management.
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