Overview

Global Distribution Systems (GDS) are key intermediaries in the travel industry, connecting travel bookers with suppliers, primarily in air travel. Developed in the 1960s to streamline airline distribution, GDS now aggregates various travel services, including hotels and car rentals. Their role is essential in facilitating seamless transactions between agencies and providers.

The following image outlines the main operational and competitive dimensions of GDS. 

A key aspect of GDS operations is its revenue structure. As shown in the chart below, 85% of GDS revenue comes from distribution, with air distribution making up three-fourths of this share, while non-air distribution accounts for the remaining quarter.

• GDS has expanded into non-air segments, including hotels, cruises, car rentals, and railway services.
• However, these ventures remain less dominant due to strong competition from established players (e.g., Bed banks).
• Incumbent alternatives in the non-air sector continue to hold a stronger foothold in the market.