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In an effort to improve booking, check-in and in-flight experiences, Delta Air Lines is buying data rights from Atlanta-based Travelport that will give it more control over technology as well as 10 years of travel history on millions of its fliers.
Delta’s move comes as airlines compete to offer a smoother experience for customers online, on mobile devices and during their trips.
Under the deal, Delta gains direct control over key systems that affect reservations and flight operations.
About 175 Travelport employees based in the Cumberland/Galleria area will work for Delta starting July 1. They will remain at the headquarters of Travelport, a travel technology firm with about 3,600 employees worldwide, and Travelport will still run the system infrastructure.
Delta CEO Richard Anderson said the arrangement deepens the airline’s relationship with Travelport, which provides back office reservations and other services for airlines, websites and travel agencies.
The deal requires “minimal cash outlay” and will make Delta the only U.S. airline with direct control over those technology systems.
Delta will control investments for its website, reservations systems, airport kiosks and other systems, and it wants to bring partner airlines onto the same technology platform, starting with Virgin Atlantic.
“The heart of the IT system at an airline is its reservations system,” Anderson said during an interview.
He said the deal gives Delta access to information including 10 years of flight data on its customers, which it can use to shape individual travel offers based on that person’s travel patterns.
Delta also will be better able to manage rebookings, refunds and information available to passengers during bad weather that disrupts schedules.
Airlines once owned their reservations systems, but sold them amid financial troubles after the Sept. 11, 2001 terrorist attacks, Anderson said.
“I was actually the lead negotiator” to sell the system owned jointly by American, Delta and Northwest airlines, Anderson said. “It was more of a financial necessity. But even then, at that time in 2002, 2003, I didn’t like the idea of giving up the asset.”
As such, “we negotiated provisions in the agreement” with contractual rights, Anderson said.
The move also helps Delta keep booking costs low, Anderson said. And it’s part of a broader effort by Delta to rebuild its computer systems so employees can work on mobile devices like tablets and smartphones.
The Travelport deal is the latest in a string of moves by Delta to gain control of critical services. Those moves include the purchase of an oil refinery and the acquisition of stakes in Virgin Atlantic, Aeromexico and Brazilian carrier Gol.
