Pilotcenter.net News is delighted to introduce Ann Cederhall as our new columnist. With a background as an instructor in Airline Distribution Strategy at IATA and Aeroclass, Ann is a well-known speaker in the industry who has written numerous respected articles in the travel press. Co-owner of the consulting firm LeapShift, Ann has a proven track record in delivering business value globally through her expertise in project and product management.

In the mid-2000s, low-cost carriers (LCCs) made a significant impact by drastically reducing distribution costs. They distinguished themselves by not utilizing Global Distribution Systems (GDS) like traditional airlines and by selling ancillaries such as baggage and seats separately. This practice, known as direct connect, involves airlines selling directly rather than through intermediaries.

Some Travel Management Companies (TMCs) and Online Travel Agents (OTAs) began incorporating content from direct channels, though at a higher cost, while the majority continued focusing on selling GDS content exclusively. Traditional network airlines soon recognized the need to reduce their distribution costs and implement technologies to unbundle ancillaries, prompting the creation of the New Distribution Capability (NDC) standard by the International Air Transport Association (IATA) in 2012.

NDC is primarily intended for travel sellers like OTAs and TMCs, offering an XML standard that airlines can employ for their direct connect API. Despite the benefits of NDC, several important aspects were overlooked during its development. Ensuring control over their APIs is crucial for airlines to implement direct connect successfully.

While many LCCs have not adopted NDC standards for their APIs, larger OTAs and TMCs integrate their content through aggregators, who gather content from various sources. GDSs have started offering their own NDC API connections to compete with aggregators, indicating a shift in airline distribution dynamics.

The decision for travel sellers to integrate NDC connections depends on various factors, with considerations such as operational setup, contract obligations, and customer demand playing significant roles. Meanwhile, LCCs continue to innovate in the industry by offering unique products and services that have reshaped customer expectations.

The choice between adopting NDC or not depends on individual business needs and strategic goals. It's essential for airlines to evaluate their current API capabilities and market demands before deciding whether to implement NDC standards. Ultimately, embracing new distribution strategies and enhancing customer experience are key factors for success in the evolving airline industry landscape.