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American has pulled its fares from Orbitz, barely hours after a Chicago judge denied a request by Orbitz to block American from doing so. The move is effective immediately, but tickets already purchased through Orbitz will remain valid. Changes must be made through American reservations by calling 800-433-7300. There is no indication of how long American will keep its fares from Orbitz.
American is trying to force Orbitz to use American’s proprietary distribution system, rather than the industry-standard global distribution system (GDS) model. By cutting out the middle man—GDSs take fares from one entity and deliver them to the other—American hopes to cut costs.
In a statement, American said, “American Airlines regrets any inconvenience this may cause our customers … In today’s competitive marketplace, it is important for American to be free to customize its product offerings to improve the customer experience as well as distribute its products in a way that does not result in unnecessary costs.”
Critics, including many of Orbitz’ competitors in the online travel marketplace, contend that American’s move is anti-competitive. Sabre Holdings, which owns Travelocity, said, “We believe American’s actions will make it much harder and more costly for agents and consumers to easily comparison shop among airlines, which will result in increased prices for consumers.” Many are wondering how long American can go without the sales created by Orbitz.
It is expected that Orbitz will sue American for breach of contract.
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