Air Transport World

Edging around the trust busters. (computer reservation system vendors' relations with government)

Government casts a long shadow over the Delta/TWA/Northwest efforts at a CRS merger aimed at competing with the Big Two. By Joan M. Feldman.

The year 1989 fanned a lot of CRS flames. The Justice Department concluded that CRS vendors don't compete enough and the systems are still biased. DOJ turned down a proposed merger between two of the systems. The Transportation Department, required by law to study current CRS rules, must decide whether it agrees with Justice and, if so, what should be done to increase CRS competition.

During the first session of the 101st Congress, two Republican Senators introduced legislation that would require airlines lo divest their CRS ventures. European governments came up with their own ideas about how vendors should act and international vendors continued to develop their own systems while simultaneously trying to ink with one another.

With this as background, the three smaller U.S. CRS vendors-Datas II, Pars and SystemOne-spent a lot of time and money trying to figure out how they could strengthen themselves against American's Sabre and United's Apollo without raising antitrust suspicions. Delta's Datas II and TWA/Northwest's Pars, trying to keep their neads above the waterline, announced last September that they would merge. No published record

Pars was not Delta's first choice. In February, Delta and American said they would merge Datas II and Sabre. But DOJ, to the surprise of many, disapproved. The parties pulled out of the deal, thereby negating the need for DOJ to file suit to plock the merger. As a result, there are no published findings that would give people a clear view of the thinking at DOJ. Apparently, it was worried about the structure of the merged CRS-which despite the 5050 ownership still gave inordinate power to Sabre-but also, it was unhappy that two of the three biggest airlines, who compete at Dallas/Ft. …

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