American Airlines filed a civil antitrust lawsuit against Travelport, LLC, and Orbitz Worldwide on Tuesday, alleging anti-competitive conduct by Orbitz and Travelport to exclude competition and maintain Travelport’s monopoly power.

AA Orbitz Distribution Update

This lawsuit is meant to put pressure on Travelport and Orbitz over their ongoing dispute with American regarding distribution of the airline’s fares and schedules. To be specific, American wants travel agencies to get its fares and schedules via its Direct Connect, bypassing the global distribution systems (GDSs).

Here’s the statement from American regarding the lawsuit, and a pdf copy of the AA court filing.

Here’s the Orbitz response (they call it anti-consumer bullying tactics, baseless lawsuit, etc.) and here’s Travelport’s response (ludicrous, without merit, and so on).

The funny part about the situation is that the lawsuit has forced Travelport to argue against itself to prove that it doesn’t have the kind of monopoly power alleged in the lawsuit. “Google, Bing, Yahoo!, and Kayak are strong new entrants in the distribution of airline tickets,” notes a Travelport statement. “Their business models often bypass GDS distribution in favor of directing consumers to airline websites.”

This kind of argument will only send a message to agencies that it wouldn’t be that big a deal in the long run if they chose Direct Connect over GDS for AA fares. In fact, American is actively encouraging it, and it has apparently contacted many agencies and told them to sign up for Direct Connect or face a $5.50 per segment fee and less than full content when booking through the GDS.

Sabre has written a letter to subscribers, penned by Chris Kroeger, Sabre Travel Network’s senior vice president of marketing, which says that AA has “has threatened them [the agencies] through a new “Content Commitment Policy,” which would essentially force them to either accept AA’s one-off, fragmented approach or face the consequences.”

American got taken to the woodshed in the first round back in January. After AA barred Orbitz from displaying its fares late last year, the matter ended up in court. Other airlines, GDSs and OTAs jumped into the fray, with Delta Air Lines cutting off a number of smaller agencies; Sabre downgraded American’s displays while American, in turn, went to court to get a restraining order; and Expedia first buried and then dropped AA fares completely.

Statements were issued against American by the Consumer Travel Alliance and Business Travel Coalition, and hundreds of Direct Connect opponents banded together under the banner of “Open Allies for Airfare Transparency.”

American since then has systematically tried to isolate Orbitz/Travelport by settling issues with others. Priceline, Kayak and many other agencies have agreed to use Direct Connect. American and Sabre have put litigation regarding this matter on hold until June. American and Expedia reached an agreement, announced on April 4, 2011, wherein Expedia gets to use GDS in the short term and agrees to use Direct Connect in the future via “aggregation technology provided by a GDS.”

That leaves only American and Orbitz/Travelport in the ring at this time. Hence the new volley by American with a lawsuit against Travelport’s alleged “monopoly power.” They’ve done a lot of spade work in the interim, and it looks like American Airlines has its ducks in a row this time.

Photo – AA Distribution Blog

Related posts:
AA Takes Heat in Orbitz Standoff
Sabre Rattling Pushes Back AA Agreement Hopes
American Airlines Stop Selling Tickets On Orbitz
Hot Topic: American Airlines Battles OTAs