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Far Eastern Economic Review
December 3rd, 1998
Easy Come, Easy Go
New services offer travellers flexibility
Ask Jon Stonham what the Internet means
for the travel industry in Asia, and he'll talk about customer reach:
"The first customer booking through our Web site came from Brazil,
and the second from Sudan of all places."
Stonham's Hong Kong-based Internet reservation
service, Asia Hotels, provides information and bookings for 1,000 hotels
and resorts throughout the region. The 34 year-old Briton founded the
company with two colleagues two years ago, and it now takes reservations
for about 3,000 room-nights every month.
Travellers from the United States provide
about 30% of Asia Hotels' business, with those from Europe and Asia
making up most of the rest a reach that would be unheard of for a
small business that didn't use the Internet. "It's got to be one
of the most powerful channels you can have in terms of expanding a customer
base from local to global," Stonham observes.
The simple Asia Hotels Web site doesn't
break any new ground in technology. But it does signal a massive shift
to exploiting technology like the Internet in the travel business. Airlines,
hotels and consumers appear set to reap huge benefits, and travel agents
if they fail to join the hi-tech stampede may be the losers.
"The technologies are not necessarily
new, but we have detected a significant trend in the increasing use
of them in the travel business,' says David Dingley, who works for U.S.
computer maker IBM as an adviser to travel and transport companies.
The growing popularity of going hi-tech
apart from cost savings and the potential to eliminate middlemen
highlights a clear desire of many travellers to make their own plans.
"You've got to give consumers what they want, and a substantial
subset just want to look after themselves," says Dingley. More
and more want Internet-based travel services and other tools to give
them greater flexibility.
In Asia, Singapore Airlines, for example,
has introduced automatic check-in at Changi airport's Terminal 2. Passengers
who have new automatic ticketing and boarding pass-tickets bypass traditional
check-in counters. Instead, they can use a machine to choose their seats,
provided they don't have luggage to check.
Dingley believes the self-serve check-in
will eventually be common. He envisages a future in which frequent flyers
are issued smart cards containing their personal travel data. After
booking a flight by phone or via the Internet, passengers would arrive
at the airport and their smart cards would be read remotely by sensors,
automatically checking them in and allocating seats.
Another innovation is ticketless air travel,
which Cathay Pacific and Singapore Airlines are already using for selected
destinations. Passengers purchase tickets directly from the airline
and use their credit card not a paper ticket to pick up boarding
passes.
But overall, Asian airlines and hotels
lag significantly behind the U.S and Europe in their use of technology
like the Internet. Asian airlines, for example, haven't begun on-line
reservations. Booking seats and credit-card sales for flights are pretty
straightforward through many U.S. Web sites, but tickets can only be
issued in the U.S. Dingley, however, says it's just a matter of time
before Asia's businesses catch up, since much of the reason for the
lag is that Internet use is simply greater in the West.
All this emphasis on direct sales and independent
travel may be good news for everyone except travel agents. Most agents
have already seen commissions on tickets fall. They will be squeezed
further as technology allows airlines to better predict their passenger
loads and for hotels to take direct bookings. "I don't think travel
agents are going away," says Dingley, "but they are going
to have to start using the technology to further their own business."
If they need ideas on how to successfully
use new technology, agents can look to established Web-based travel
services such as Travelocity, Preview Travel and Expedia Travel
that have already become popular with those looking to book through
the Internet. Travelocity's Web site allows Asian users to plan flights
the system will check availability and quote fares but that's all,
since tickets have to be issued in the U.S. to a U.S. credit-card holder
and flights must originate there.
These services, which are attached to Internet
portals such as Yahoo!, mean more competition for businesses like Asia
Hotels. But Stonham maintains that the advantage of global reach and
local knowledge will be tough to beat. "We often do reservations
for travel agents as well after all, what does an agent in Seattle
know about the choice of hotels in Malaysia?"
Charles Bickers, Hong Kong
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