Wednesday 4 July 2007

GDS History

GDS, CRS and channel management
The GDS have long been the primary source of travel agents bookings in the world. Today they do much more and supply content rates and hotel inventory to thousands of On-line Travel website.
The GDS systems are a huge network of thousands of computers set up originally by companies like Sabre, WorldSapn. Amedeus, Galileo and Pegasus. They provided Computer Based Reservations (CRS) services to all travel agents long before the Internet. These system are still in place and are used by more that 480,000 agents worldwide.
When you visit a Travel Agent you will see them at the CRS to find and book flights and resorts.
It has traditionally been an expensive distribution system requiring setup fees in the thousands of dollars as well as booking fees, transaction fees and agents commissions. As a result many smaller hotels are not represented in the GDS and GDS have not been too interested in this sector as they problem of coordinating inventory has been too great (a small hotel just does not have a sufficient supply of rooms to justify the effort of cost them up).

With the advent of new technology this has changed. Now there are GDS agent companies who specialise in supplying content to the GDS computers. The Internet also makes it easier to get the information and distribute it. This has made GDS widely available to hotels of all size. An inovator in opening up the Market was Tom Egan of reserv, who single handedly changed the face of distribution by offering an easy to use system with no setup fees and no minimum charges. His system worked on next Generation technology meaning that the entire process of setting up a hotel was done on-line, no manual entry. Alas Tom sold out and his ideas hot the dust.
2 way integration
New e-commerce systems (such as arcRes, and are integrated with the GDS system to make it even easier and more affordable for hotels to market throught GDS. The two way integration makes it easier to setup and to manage rates and inventory in multiple channels. It essentially means that a hotel can use their own web booking engine or front desk software (that is GDS integrated) to see and process GDS reservation and to update allocation and rates. This is a great advantage as it means less to learn and to manage.
see also GDS Next Generation Seamless
A major problem facing the industry now is the proliferation of vendors. Whereas before we had a few key Tour Operators, now there are numerous Internet companies, like Expedia, Travelocity,, and many others that have vastly more exposure that the traditional Tour Operators. Getting products onto these system and maintaining rates, content and inventory requires full time management and is not feasible for many small resorts.

Fortunatly new hotel tools like arcRes Website Bookings Engine (Bookings-Expert) now provide a single system to maintain. It also makes rates management easier by allow suppliers to specify any rate in any channel as a % of another rates or a markup on costs. Other companies like AXSES are working on building tools that will change the face of distribution giving suppliers (hotels and tourism operators) control over the supply chain. The new model emerging is supplier centered, supply chain management.

In the new business model the hotel and tourism operator tools (field tools) are fully integrated at the operator level and with downstream distribution. For example the web bookings engine is integrated with property management, housekeeping and inventory. All this is integrated with the GDS system and destination portals like as well as with the GDS, and retail sites like feeding from the central database updated by arcRes.

Very Long Ago.
The history of the development of GDS is a great story. One of the best accounts I have seen is available at
In breif, it follows the development of a reservation systems spearheaded by American Airlines. The startup of ThisCo the switch that connected hotels to the airlines and travel agents systems and all the steps leading up to that.

© Ian Clayton, AXSES SCI 2007.
see arcRes solutions for tourism, AXSES web Solution


My Profile said...

Do you have any idea what a hotel pays the GDS in a transaction fee when a room is booked and consumed?

irclay said...

its all explained on our AXSES arcres site - see and click GDS in the search.

or go to

in a nutshell - u will pay a fee to the gds of about 6$ - u pay 7$ to the gds coneect partner - u pay 10% to the travel agent using the GDS

Thr is a setup fee of up to 300$ and a Monthly Maintenance fee of $50 us

if you wish i can give u an exact quote based on speciac configurations -

OnlineGDS said...

Reply to Myprofile. It will turn around 20% of room rate that includes GDS fee, travel agent fee and GDS representing company fee. There is no set up fee and no monthly fee at

irclay said...

Hi Online - sent u an email on contact us at yr site - look forward to seeing how we can work with you. Thanks for the post

Online Hotel Reservation Booking Software said...

Hi, Guys i am so glad to visit your blog it's an informative for travel technology Thanks!