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Thu, Dec 23, 2010

Orbitz, American Part Company

Judge Rules Against Temporary Restraining Order To Prevent The Move

American Airlines has pulled its fares off the Orbitz website, effective immediately. The move comes following a dispute over how the airline sells fares and other services through the site. A Cook County, IL judge ruled that American could sever its relationship with Orbitz Tuesday.

In a news release, American said it will discontinue displaying and selling fares through Orbitz and its subsidiary Orbitz for Business. Tickets for travel already purchased through Orbitz remain valid but changes must be made through American Airlines reservations.

Tickets for travel on American Airlines and American Eagle – including all international and domestic classes of service – are widely available through a number of outlets, including American's own website, AA.com, which features our Lowest Fare Guarantee. Tickets, fares and schedules are also available through American's reservations agents, thousands of travel agencies in locations worldwide, other online travel agencies such as Priceline.com, and metasearch engines such as Kayak.com.

"American Airlines regrets any inconvenience this may cause our customers. While we could not reach an agreement with Orbitz, we are committed to letting customers know of the multitude of options they have to purchase travel on American Airlines," said Derek DeCross, Vice President - Sales. "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."

American also continues to provide its fare content to travel agency partners, both through global distribution systems and through American's own direct connection technology that is powered by Farelogix. There is no charge to agencies for using American's direct connection, which allows travel agencies to offer their customers more complete and tailored travel choices, including fares and optional services.

The Chicago Tribune reports that American's dispute with online fare sites extends beyond Orbitz. The airline has established a system it calls "Direct Connect", which would reduce distribution costs to the airline, but also reduce the role played by fare comparison sites like Orbitz and others. American says allowing the airline to directly communicate with its customers gives them the ability to tailor fares and perks based on the customers' needs. Consumer advocates say that bypassing the services for transactions would limit the fare comparison sites ability to display the best fares available.

Other airlines are reportely watching the situation very closely. The Atlanta Journal Constitution reported Wednesday that Delta had severed its relationship with three small fare comparison sites ... CheapOAir.com, OneTravel.com and BookIt.com ... as of December 17th. Delta is honoring tickets purchased through those sites, but no longer makes flight information available to them. Delta said it was trying to increase bookings directly through Delta.com.

One consumer group was quick to blast American's move. In a news release, Charlie Leocha, director of an organization called the Consumer Travel Alliance, said "At its core, this dispute has nothing to do with business agreements, legal arguments, or distribution technologies. This is simply a heavy-handed attempt by American Airlines to prevent consumers from easily searching and comparing its fares against those of other airlines. In short, the only 'direct connect' American really seems to want is a 'direct connect' to consumers' wallets.

FMI: http://www.aa.com/orbitz, http://consumertravelalliance.org

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