© 2009 Sabre Inc. All rights reserved. wearelistening@sabre.com

2004 Issue No. 2A MAGAZINE FOR AIRLINE EXECUTIVES

T a k i n g y o u r a i r l i n e t o n e w h e i g h t s

Air France and KLM formEurope’s Largest Airline

The Evolution of Alliances

A Conversation withoneworld, SkyTeamand Star Alliance

4

18

26

I N S I D E

A N A L L I E D F R O N TA conversation with …

Geoff Dixon, CEO,Qantas Airways

industry

ascend 27

Phot

o co

urte

sy o

f o

new

orld

Photos courtesy of SkyTeam

Photos courtesy of Star Alliance

T he past decade has seen the rise of the major international airline alliances —

Star Alliance, oneworld and SkyTeam. From the start, alliances have offered

their members key benefits, such as the ability to offer customers access to more

destinations around the world and the ability to redeem frequent flyer miles on a

number of carriers.

Certainly, the alliances have already had a significant impact on the industry and will

likely continue to do so in the future. Ascend magazine asked representatives of the

three main alliances to answer a few questions about the affect they’ve had, and the

changes they will continue to make.

Spanning the Globe

industry

ascend 27

Phot

o co

urte

sy o

f o

new

orld

Photos courtesy of SkyTeam

Photos courtesy of Star Alliance

T he past decade has seen the rise of the major international airline alliances —

Star Alliance, oneworld and SkyTeam. From the start, alliances have offered

their members key benefits, such as the ability to offer customers access to more

destinations around the world and the ability to redeem frequent flyer miles on a

number of carriers.

Certainly, the alliances have already had a significant impact on the industry and will

likely continue to do so in the future. Ascend magazine asked representatives of the

three main alliances to answer a few questions about the affect they’ve had, and the

changes they will continue to make.

Spanning the Globe

as in raising revenues, and we know there ismore work we can be doing in this arena.Star Alliance: Emerging technologiescontinue to play an important role.

For example, together with three of ourmember carriers, we are working on a com-mon IT platform project that will revolutionizethe industry by replacing current systems withone technology platform based on industry-leading products and state-of-the-art technolo-gy for passenger services systems. The initia-tive will have the flexibility to admit othermembers of the Star Alliance network at alater date. Driving the effort is the desire toimprove customer service, significantly lowerdistribution costs and dramatically increasethe speed of delivering new products to market.

We’re also developing Star Alliance self-service check-in units and will be launchingtrue multilateral interline electronic ticketing —a product that features common and sharedbusiness processes and messaging verses amyriad of bilateral solutions — in 2004.

Overall, Star Alliance views technology as keyto putting customers more in control of theirtravel experience and airlines more in controlof their passenger boarding costs.

Additionally, Star Alliance is looking atother initiatives to reduce costs for the mem-ber carriers, including managing the purchaseof commodity items.Q: Is membership in an alliance key to sur-

vival for the existing traditional carriers?

oneworld: Carriers — and not just legacycarriers — are certainly recognizing the bene-fits that come from being a member of analliance.

Today, 19 of the world’s 20 biggest air-lines are already part of one of the big threegroupings or talking about joining. Smaller air-lines, too, have seen what a global alliance cando for them.

But, of course, becoming a member of analliance cannot in itself be the key to survival.It can certainly help, but airlines must also ensuretheir own houses are in order if they are to prosper.

Star Alliance: Membership in analliance is an important strategy for traditionalcarriers; indeed it is a key element in their tran-sition to new, more profitable business mod-els from both a revenue and cost-saving per-spective.SkyTeam: Airline alliances are key to pro-viding customers with the most travel options.For a traditional hub-and-spoke airline to bestserve its customers, global alliances open theworld for travelers and allow them to offermore destinations and greater frequencies.Q: How does your alliance differ from the

other two?

SkyTeam: SkyTeam is the youngest ofthe global airline alliances, having formed in2000, but has the most momentum. This fall,we added three new carriers — ContinentalAirlines, KLM Royal Dutch Airlines andNorthwest Airlines — resulting in a new nine-member alliance.

In addition, we differentiate ourselvesfrom other airline alliances with our emphasis

industry

ascend 29

Question: What are the advantages of

being a member of your alliance?

Star Alliance: On the customer side,member airlines can significantly enhancetheir product offering by providing access toan unsurpassed global network of over 14,000daily flights to 755 destinations in 132 coun-tries, better flight connections, alliance-widefrequent flyer benefits, lounge access and pri-ority baggage.

For the member airlines, the improvedoffering brings more passengers and gener-ates more revenue.

Additionally, Star Alliance has initiated avariety of projects — in areas such as fleetcoordination, the joint purchasing of mediaadvertising, third-party services and fuel aswell as the collocation and consolidation offacilities at airports across the network — thatreduce costs for member carriers. We havealso generated savings as the result of infor-mation technology sourcing via alliance-wideframe agreements for high-cost IT spenditems such as wide area network services andtechnology platforms.oneworld: oneworld provides our mem-bers with benefits and value that no airline canprovide or achieve on its own or working bilat-erally with other carriers.

This flows from the opportunity toincrease and protect revenues through theadditional services and products oneworldenables them to offer — a wider route net-work, and more opportunities for frequentflyer program members to earn and redeemrewards, use lounges and enjoy priority ser-vice in more parts of the world, etc. It alsocomes from fare products and sales offeringsthat no single airline can offer on its own.

Added to that are the substantial oppor-tunities we have provided our partners toreduce their costs.

Members of oneworld have generatedadditional value totaling many billions of U.S.dollars under the alliance’s umbrella.

With margins in this industry so tight,that’s more than a welcome contribution.SkyTeam: SkyTeam is designed for thepassenger from the ground up, with anexcellent core network and the best growthpotential of any alliance. Membership inSkyTeam will present an airline with signifi-cant opportunities, including an enhancedposition in response to competitive challengeswithin its region of the world and develop-ment of global cargo service. In order to sat-isfy the needs of today’s traveler, airlinesmust continue to extend and diversify their

products and services. SkyTeam will providecustomers with the benefits and advantagesthey want.Q: You’ve already achieved many benefits

from partnering, such as expanding the

reach of member airlines and sharing fre-

quent flyer programs. What untapped ben-

efits can be gained as your alliance contin-

ues to evolve?

SkyTeam: We are developing a strategicplan that includes many areas of cost syner-gies, including co-locations at ticket officesand within airports and joint purchasing of air-craft components and fuel. SkyTeam has ten-dered 40 joint fuel purchases during the lastthree years.

We are looking at joint aircraft purchasesas part of our long-term fleet strategy anddeveloping strategic specifications.

oneworld: Global alliances were createdoriginally as marketing and sales tools for air-lines to help partners increase and protecttheir revenues by providing additional servicesand products to their customers.

The potential of alliances to help reducecosts only came to the forefront during themarket softening ahead of 9/11. Since then,there has been as much of a focus, or evenmore, on how airlines can improve their effi-ciency by working together.

We’ve made some impressive strides inthis direction, saving hundreds of millions ofU.S. dollars through joint purchasing of itemsranging from fuel and aircraft spare parts totowels and plastic glasses and by cooperatingin many other areas.

We feel there is as much scope to con-tribute on the cost-savings side of the equation

industry

ascend28

Possessing more international

presence than any other global

alliance, oneworld serves a total

of 135 territories, offering its

travelers a 575-destination network

with access to nearly 400 airport

lounges worldwide.

The 15 members of the Star Alliance,

which was formed in 1997, provide

access to 772 airports in 133 countries

as well as 575 lounges around the world.

Phot

os c

ourt

esy

of o

new

orld

Phot

os c

ourt

esy

of S

tar

Alli

ance

as in raising revenues, and we know there ismore work we can be doing in this arena.Star Alliance: Emerging technologiescontinue to play an important role.

For example, together with three of ourmember carriers, we are working on a com-mon IT platform project that will revolutionizethe industry by replacing current systems withone technology platform based on industry-leading products and state-of-the-art technolo-gy for passenger services systems. The initia-tive will have the flexibility to admit othermembers of the Star Alliance network at alater date. Driving the effort is the desire toimprove customer service, significantly lowerdistribution costs and dramatically increasethe speed of delivering new products to market.

We’re also developing Star Alliance self-service check-in units and will be launchingtrue multilateral interline electronic ticketing —a product that features common and sharedbusiness processes and messaging verses amyriad of bilateral solutions — in 2004.

Overall, Star Alliance views technology as keyto putting customers more in control of theirtravel experience and airlines more in controlof their passenger boarding costs.

Additionally, Star Alliance is looking atother initiatives to reduce costs for the mem-ber carriers, including managing the purchaseof commodity items.Q: Is membership in an alliance key to sur-

vival for the existing traditional carriers?

oneworld: Carriers — and not just legacycarriers — are certainly recognizing the bene-fits that come from being a member of analliance.

Today, 19 of the world’s 20 biggest air-lines are already part of one of the big threegroupings or talking about joining. Smaller air-lines, too, have seen what a global alliance cando for them.

But, of course, becoming a member of analliance cannot in itself be the key to survival.It can certainly help, but airlines must also ensuretheir own houses are in order if they are to prosper.

Star Alliance: Membership in analliance is an important strategy for traditionalcarriers; indeed it is a key element in their tran-sition to new, more profitable business mod-els from both a revenue and cost-saving per-spective.SkyTeam: Airline alliances are key to pro-viding customers with the most travel options.For a traditional hub-and-spoke airline to bestserve its customers, global alliances open theworld for travelers and allow them to offermore destinations and greater frequencies.Q: How does your alliance differ from the

other two?

SkyTeam: SkyTeam is the youngest ofthe global airline alliances, having formed in2000, but has the most momentum. This fall,we added three new carriers — ContinentalAirlines, KLM Royal Dutch Airlines andNorthwest Airlines — resulting in a new nine-member alliance.

In addition, we differentiate ourselvesfrom other airline alliances with our emphasis

industry

ascend 29

Question: What are the advantages of

being a member of your alliance?

Star Alliance: On the customer side,member airlines can significantly enhancetheir product offering by providing access toan unsurpassed global network of over 14,000daily flights to 755 destinations in 132 coun-tries, better flight connections, alliance-widefrequent flyer benefits, lounge access and pri-ority baggage.

For the member airlines, the improvedoffering brings more passengers and gener-ates more revenue.

Additionally, Star Alliance has initiated avariety of projects — in areas such as fleetcoordination, the joint purchasing of mediaadvertising, third-party services and fuel aswell as the collocation and consolidation offacilities at airports across the network — thatreduce costs for member carriers. We havealso generated savings as the result of infor-mation technology sourcing via alliance-wideframe agreements for high-cost IT spenditems such as wide area network services andtechnology platforms.oneworld: oneworld provides our mem-bers with benefits and value that no airline canprovide or achieve on its own or working bilat-erally with other carriers.

This flows from the opportunity toincrease and protect revenues through theadditional services and products oneworldenables them to offer — a wider route net-work, and more opportunities for frequentflyer program members to earn and redeemrewards, use lounges and enjoy priority ser-vice in more parts of the world, etc. It alsocomes from fare products and sales offeringsthat no single airline can offer on its own.

Added to that are the substantial oppor-tunities we have provided our partners toreduce their costs.

Members of oneworld have generatedadditional value totaling many billions of U.S.dollars under the alliance’s umbrella.

With margins in this industry so tight,that’s more than a welcome contribution.SkyTeam: SkyTeam is designed for thepassenger from the ground up, with anexcellent core network and the best growthpotential of any alliance. Membership inSkyTeam will present an airline with signifi-cant opportunities, including an enhancedposition in response to competitive challengeswithin its region of the world and develop-ment of global cargo service. In order to sat-isfy the needs of today’s traveler, airlinesmust continue to extend and diversify their

products and services. SkyTeam will providecustomers with the benefits and advantagesthey want.Q: You’ve already achieved many benefits

from partnering, such as expanding the

reach of member airlines and sharing fre-

quent flyer programs. What untapped ben-

efits can be gained as your alliance contin-

ues to evolve?

SkyTeam: We are developing a strategicplan that includes many areas of cost syner-gies, including co-locations at ticket officesand within airports and joint purchasing of air-craft components and fuel. SkyTeam has ten-dered 40 joint fuel purchases during the lastthree years.

We are looking at joint aircraft purchasesas part of our long-term fleet strategy anddeveloping strategic specifications.

oneworld: Global alliances were createdoriginally as marketing and sales tools for air-lines to help partners increase and protecttheir revenues by providing additional servicesand products to their customers.

The potential of alliances to help reducecosts only came to the forefront during themarket softening ahead of 9/11. Since then,there has been as much of a focus, or evenmore, on how airlines can improve their effi-ciency by working together.

We’ve made some impressive strides inthis direction, saving hundreds of millions ofU.S. dollars through joint purchasing of itemsranging from fuel and aircraft spare parts totowels and plastic glasses and by cooperatingin many other areas.

We feel there is as much scope to con-tribute on the cost-savings side of the equation

industry

ascend28

Possessing more international

presence than any other global

alliance, oneworld serves a total

of 135 territories, offering its

travelers a 575-destination network

with access to nearly 400 airport

lounges worldwide.

The 15 members of the Star Alliance,

which was formed in 1997, provide

access to 772 airports in 133 countries

as well as 575 lounges around the world.

Phot

os c

ourt

esy

of o

new

orld

Phot

os c

ourt

esy

of S

tar

Alli

ance

systems. This is a mandatory requirement ofmembership as it to enables carriers deliverthe oneworld customer proposition.

Consistent delivery of customer service(customer recognition, seamless journey andtransfers, global support, more opportunitiesfor frequent flyer program members to earnand redeem miles, etc.) is seen as an impor-tant oneworld differentiator.

An example of how well our systemsconnect is that oneworld will be the first ofthe global alliances to offer interline e-ticket-ing between all partners, on track for com-pletion by the end of this year, far ahead ofour competitors.SkyTeam: Currently, our IT systemsare integrated to allow our passengers toaccrue frequent flyer miles on everySkyTeam coded flight and redeem mileagefor awards on any SkyTeam operated flight.In addition, our systems are enabled for a

single check in, meaning passengers receiveboarding passes and baggage transfers formulti-leg international itineraries at the startof their trips.Star Alliance: From the outset, it wasclear to Star Alliance that developing count-less bilateral connections among the mem-ber carriers’ varying IT systems would not bean efficient solution. Instead, we opted toseamlessly integrate business functionalitieswithout conducting system integration. Forthis, Star Alliance developed StarNet, a mid-dleware platform and network infrastructurethat connects key member carrier systems.StarNet, in addition to providing the basicssuch as through check in across the alliance,enables Star Alliance to provide flight infor-mation on any member carrier’s flight atcheck in, and it also allows customers tobook award travel on any member carrierwith one phone call.

Q: As airlines continue to automate, what

plans do you have for increased future inte-

gration of IT systems among your member

airlines?

Star Alliance: The common IT platform,as was mentioned before, will be a breakthroughin this area, and each carrier will have the optionof participating in the future. Additionally, wewill continue to develop and leverage StarNetto deliver new products and services to thecustomers and our member airlines.oneworld: While using a single platformcan deliver advantage by making it simpler todevelop common business processes, whereappropriate, and a consistent approach todelivering the customer proposition at thesame time facilitating quicker and less costlyfunctional changes, the cost of moving plat-forms, in terms of business change apart fromanything else, is very significant and notundertaken lightly. Over time, we anticipatemore convergence to take place as opportuni-ties present themselves.SkyTeam: Right now, SkyTeam isfocused on ensuring that passengers of ourthree newest member airlines, Continental,KLM and Northwest, receive all of our 10 cus-tomer benefits. As part of the new memberintegration process, all carriers are investigat-ing ways to collaborate further. For example,SkyTeam intends to start interline electronicticketing next year to customers traveling viaany member airline.Q: How has your alliance transformed since

it began?

SkyTeam: Since SkyTeam’s launch four

T H E H I G H L E V E Lvıew News Briefs from Around the Globe

Who

Jet Airways

What

In a move to modernize its operational

systems, the airline selected the

Sabre ® AirOps ™ Suite, which is

designed to monitor daily flight

movements and assist operations

controllers in making informed

decisions regarding all aspects of

flight operations. The suite will

enable the airline to drive improve-

ments in on-time performance,

maintenance and disruption costs.

Why

“There is no doubt flight operations is

mission critical,” said Peter Luethi,

chief operating officer for Jet Airways.

“It is a particularly pertinent issue for

Jet Airways as we face the unique

challenge of regular fogs in Delhi,

India, every year for two months;

hence, it is imperative that we have

the best tools available to manage

our flight operations. To meet

our growing needs — and also for

international routes — we realized we

required a robust, integrated solution

that is proven in the marketplace,

and the AirOps suite met all our

criteria.” a

industry

on passenger services and benefits. SkyTeamis the first alliance built around customerneeds. SkyTeam has the best hubs in key mar-kets where 80 percent of the world’s trafficflies: Atlanta, No. 1 in the world; Paris-Charlesde Gaulle, No. 1 in Europe; Incheon, the onlyAsian hub with room to grow; Mexico City, No.1 in Latin America; and more importantly, cus-tomers are able to earn and redeem frequentflyer miles on any SkyTeam operated flight.Star Alliance: Overall, the StarAlliance network features more flights, tomore destinations, more often. We have alsoled the way in developing products that easetravel for international passengers. All of thisled to Star Alliance being voted the best airlinealliance in 2003 by customers, in a SkyTrax pollof more than 30,000 frequent flyers, as well asby influential publications Business Travelermagazine (United States) and BusinessTraveller magazine (United Kingdom).

Being founded more than seven yearsago, Star Alliance has accumulated a wealth ofexperience, which has transformed it into amore mature and effective organization. Infact, a dedicated project and brand manage-ment organization has been installed inFrankfurt, Germany, to coordinate and supportmember carriers in the development and deliv-ery of new products, services and a host ofcost-saving initiatives.oneworld: It starts with the quality of ourmembers. We believe we have the highestquality carriers in each region on board — interms of their customer service and overallsoundness.

How can we justify that bold claim? It isa fact that oneworld was the only alliancewhose members collectively reported profitsfor 2003.

Our partners also regularly win moreawards than their counterparts in the othertwo groupings combined. For example,oneworld members accounted for four of thesix 2004 Airline Strategy Awards presented inJuly by leading industry magazine AirlineBusiness. The top prize, for executive leader-ship, has remained since its inception in 2002in the hands of oneworld partners. Our eightcarriers took five top places in the 2004 OAGAirline of the Year Awards.

These and the other awards oneworldcarriers have won are a reflection of the excel-lent customer service and value they offer —from the flat beds most of them provide intheir long-haul premium cabins to the attrac-tive fares they market.

They also work well together as an alliance.

The oneworld alliance itself was namedthe World’s Leading Airline Alliance in themost recent World Travel Awards, whichdescribes itself as the travel industry’s No. 1awards scheme, based on votes cast by80,000 travel agency professionals from morethan 200 countries.

The oneworld alliance offers a widerrange of alliance fares than all the competitioncombined, earning hundreds of millions ofU.S. dollars a year for our partners.

We are committed to customer serviceleadership and innovation. We are on track tobe the first alliance with interline e-ticketingamong all member airlines by the end of 2004,providing greater convenience to our cus-tomers and saving scores of millions for ourmember airlines.

A number of the benefits that we’vehad in place since the launch of our alliancemore than five years ago have only recentlybeen offered by our competitors.

We are now looking further ahead at how we can work together to make

journeys across our alliance networksmoother still.

We are also different in our overallmembership philosophy. We are not just par-ticularly choosey about who we invite to join,but we are also determined to keep the num-bers of our partners to a manageable numberof high-quality carriers who can work welltogether.

This all results in financial contributionsto our members that, we believe, stand anycomparisons with our competitors.Q: How extensively are the IT systems of

your member airlines integrated?

oneworld: Five oneworld carriers (BritishAirways, Qantas, Iberia, LAN and Finnair) areconverging around a single passenger servicesystem while American Airlines is hosted onanother and Cathay Pacific and Aer Lingusmaintain their own in-house PSS systems.Comprehensive links have been developedbetween these platforms and among the carri-ers’ in-house revenue accounting, frequent flyerprogram management and business intelligence

industry

ascend30

With the entrance of newcomers

Continental Airlines, Northwest

Airlines and KLM, the SkyTeam

alliance serves 341 million passengers

a year to 658 global destinations

in more than 130 countries and

provides access to almost 400

lounges worldwide.

The “Star Alliance Visit Japan Campaign,”

launched earlier this year, has helped

boost travel to Japan by about 30 percent

year over year.

Star member All Nippon Airways earlier

this year received its first Boeing 777-300ER,

the first ANA aircraft to have mobile Internet

and e-mail service.

Phot

os c

ourt

esy

of S

kyTe

am

Phot

o co

urte

sy o

f S

tar

Alli

ance

systems. This is a mandatory requirement ofmembership as it to enables carriers deliverthe oneworld customer proposition.

Consistent delivery of customer service(customer recognition, seamless journey andtransfers, global support, more opportunitiesfor frequent flyer program members to earnand redeem miles, etc.) is seen as an impor-tant oneworld differentiator.

An example of how well our systemsconnect is that oneworld will be the first ofthe global alliances to offer interline e-ticket-ing between all partners, on track for com-pletion by the end of this year, far ahead ofour competitors.SkyTeam: Currently, our IT systemsare integrated to allow our passengers toaccrue frequent flyer miles on everySkyTeam coded flight and redeem mileagefor awards on any SkyTeam operated flight.In addition, our systems are enabled for a

single check in, meaning passengers receiveboarding passes and baggage transfers formulti-leg international itineraries at the startof their trips.Star Alliance: From the outset, it wasclear to Star Alliance that developing count-less bilateral connections among the mem-ber carriers’ varying IT systems would not bean efficient solution. Instead, we opted toseamlessly integrate business functionalitieswithout conducting system integration. Forthis, Star Alliance developed StarNet, a mid-dleware platform and network infrastructurethat connects key member carrier systems.StarNet, in addition to providing the basicssuch as through check in across the alliance,enables Star Alliance to provide flight infor-mation on any member carrier’s flight atcheck in, and it also allows customers tobook award travel on any member carrierwith one phone call.

Q: As airlines continue to automate, what

plans do you have for increased future inte-

gration of IT systems among your member

airlines?

Star Alliance: The common IT platform,as was mentioned before, will be a breakthroughin this area, and each carrier will have the optionof participating in the future. Additionally, wewill continue to develop and leverage StarNetto deliver new products and services to thecustomers and our member airlines.oneworld: While using a single platformcan deliver advantage by making it simpler todevelop common business processes, whereappropriate, and a consistent approach todelivering the customer proposition at thesame time facilitating quicker and less costlyfunctional changes, the cost of moving plat-forms, in terms of business change apart fromanything else, is very significant and notundertaken lightly. Over time, we anticipatemore convergence to take place as opportuni-ties present themselves.SkyTeam: Right now, SkyTeam isfocused on ensuring that passengers of ourthree newest member airlines, Continental,KLM and Northwest, receive all of our 10 cus-tomer benefits. As part of the new memberintegration process, all carriers are investigat-ing ways to collaborate further. For example,SkyTeam intends to start interline electronicticketing next year to customers traveling viaany member airline.Q: How has your alliance transformed since

it began?

SkyTeam: Since SkyTeam’s launch four

T H E H I G H L E V E Lvıew News Briefs from Around the Globe

Who

Jet Airways

What

In a move to modernize its operational

systems, the airline selected the

Sabre ® AirOps ™ Suite, which is

designed to monitor daily flight

movements and assist operations

controllers in making informed

decisions regarding all aspects of

flight operations. The suite will

enable the airline to drive improve-

ments in on-time performance,

maintenance and disruption costs.

Why

“There is no doubt flight operations is

mission critical,” said Peter Luethi,

chief operating officer for Jet Airways.

“It is a particularly pertinent issue for

Jet Airways as we face the unique

challenge of regular fogs in Delhi,

India, every year for two months;

hence, it is imperative that we have

the best tools available to manage

our flight operations. To meet

our growing needs — and also for

international routes — we realized we

required a robust, integrated solution

that is proven in the marketplace,

and the AirOps suite met all our

criteria.” a

industry

on passenger services and benefits. SkyTeamis the first alliance built around customerneeds. SkyTeam has the best hubs in key mar-kets where 80 percent of the world’s trafficflies: Atlanta, No. 1 in the world; Paris-Charlesde Gaulle, No. 1 in Europe; Incheon, the onlyAsian hub with room to grow; Mexico City, No.1 in Latin America; and more importantly, cus-tomers are able to earn and redeem frequentflyer miles on any SkyTeam operated flight.Star Alliance: Overall, the StarAlliance network features more flights, tomore destinations, more often. We have alsoled the way in developing products that easetravel for international passengers. All of thisled to Star Alliance being voted the best airlinealliance in 2003 by customers, in a SkyTrax pollof more than 30,000 frequent flyers, as well asby influential publications Business Travelermagazine (United States) and BusinessTraveller magazine (United Kingdom).

Being founded more than seven yearsago, Star Alliance has accumulated a wealth ofexperience, which has transformed it into amore mature and effective organization. Infact, a dedicated project and brand manage-ment organization has been installed inFrankfurt, Germany, to coordinate and supportmember carriers in the development and deliv-ery of new products, services and a host ofcost-saving initiatives.oneworld: It starts with the quality of ourmembers. We believe we have the highestquality carriers in each region on board — interms of their customer service and overallsoundness.

How can we justify that bold claim? It isa fact that oneworld was the only alliancewhose members collectively reported profitsfor 2003.

Our partners also regularly win moreawards than their counterparts in the othertwo groupings combined. For example,oneworld members accounted for four of thesix 2004 Airline Strategy Awards presented inJuly by leading industry magazine AirlineBusiness. The top prize, for executive leader-ship, has remained since its inception in 2002in the hands of oneworld partners. Our eightcarriers took five top places in the 2004 OAGAirline of the Year Awards.

These and the other awards oneworldcarriers have won are a reflection of the excel-lent customer service and value they offer —from the flat beds most of them provide intheir long-haul premium cabins to the attrac-tive fares they market.

They also work well together as an alliance.

The oneworld alliance itself was namedthe World’s Leading Airline Alliance in themost recent World Travel Awards, whichdescribes itself as the travel industry’s No. 1awards scheme, based on votes cast by80,000 travel agency professionals from morethan 200 countries.

The oneworld alliance offers a widerrange of alliance fares than all the competitioncombined, earning hundreds of millions ofU.S. dollars a year for our partners.

We are committed to customer serviceleadership and innovation. We are on track tobe the first alliance with interline e-ticketingamong all member airlines by the end of 2004,providing greater convenience to our cus-tomers and saving scores of millions for ourmember airlines.

A number of the benefits that we’vehad in place since the launch of our alliancemore than five years ago have only recentlybeen offered by our competitors.

We are now looking further ahead at how we can work together to make

journeys across our alliance networksmoother still.

We are also different in our overallmembership philosophy. We are not just par-ticularly choosey about who we invite to join,but we are also determined to keep the num-bers of our partners to a manageable numberof high-quality carriers who can work welltogether.

This all results in financial contributionsto our members that, we believe, stand anycomparisons with our competitors.Q: How extensively are the IT systems of

your member airlines integrated?

oneworld: Five oneworld carriers (BritishAirways, Qantas, Iberia, LAN and Finnair) areconverging around a single passenger servicesystem while American Airlines is hosted onanother and Cathay Pacific and Aer Lingusmaintain their own in-house PSS systems.Comprehensive links have been developedbetween these platforms and among the carri-ers’ in-house revenue accounting, frequent flyerprogram management and business intelligence

industry

ascend30

With the entrance of newcomers

Continental Airlines, Northwest

Airlines and KLM, the SkyTeam

alliance serves 341 million passengers

a year to 658 global destinations

in more than 130 countries and

provides access to almost 400

lounges worldwide.

The “Star Alliance Visit Japan Campaign,”

launched earlier this year, has helped

boost travel to Japan by about 30 percent

year over year.

Star member All Nippon Airways earlier

this year received its first Boeing 777-300ER,

the first ANA aircraft to have mobile Internet

and e-mail service.

Phot

os c

ourt

esy

of S

kyTe

am

Phot

o co

urte

sy o

f S

tar

Alli

ance

one of the country’s most affluent regionswith promising growth opportunities. As ChinaSouthern’s main base, Guangzhou is also a keytransportation center in southern China. Thenew Guangzhou Baiyun International Airport,which opened earlier this month, will comple-ment SkyTeam’s strong hub network and fur-ther expand the alliance’s Asian offerings.China Southern is also preparing a new facilityin Beijing to serve customers.

Last year, SkyTeam announced that it isdeveloping an associate member concept thatwill allow smaller, regional carriers to join theSkyTeam network and provide customers withaccess to even more destinations around theworld. As we finalize this concept, we willhave several associate members to announce.Q: What criteria do you use to determine

which new carriers to invite to join your

alliance?

SkyTeam: As with all decisions, newmember invitations are discussed among theGoverning Board and agreed upon by unani-mous consent. Each new member must meeta stringent set of requirements prior to receiv-ing an invitation for membership.Star Alliance: They must be qualitycarriers with outstanding safety and servicereputations that enhance our network, productand service offering.oneworld: Any new recruit has to pass sixmembership benchmarks. They must:

Broaden and deepen our alliance’s networkin strategic world regions,Offer a high-quality product and service

levels consistent with the existing oneworldmembers,Enjoy strong brand awareness,Maintain high operational standards,Add value to both the alliance’s customersand its existing partners,Contribute positively to oneworld’s “man-ageable nature.”

Q: How involved is the process of joining

your alliance?

oneworld: Once it has been elected onboard as a member designate, any new recruitmust be able to offer the full range ofoneworld services and benefits before it canjoin. What this involves is spelled out in whatwe call our delivery requirements document.

One of our existing carriers will act as asponsor, to provide guidance and assistance tothe new recruit in this process, with our cen-tral alliance team supporting the overall pro-gram.

How involved this all is depends on howaligned the new recruit is with oneworld’s poli-cies, procedures and processes.SkyTeam: SkyTeam membershiprequirements comprise numerous factorsincluding customer service, safety levels andtechnology adaptability. All new membersmust live up to the alliance’s customer servicestandards and provide a consistent, high levelof quality for their passengers everywherethey fly.Star Alliance: There are a number oftechnical requirements that must be met;however, as agreed with our member carriers,

details on matters of governance cannot bedisclosed.Q: Are the current alliances the first step

in a worldwide airline consolidation?

Star Alliance: The benefits that comewith membership in an alliance, both in termsof increased revenue and reduced costs, cre-ate significant value and reduce the need forconsolidation.oneworld: Undoubtedly. But alliances willstill be able to provide big, consolidated air-lines with benefits and value that they cannotachieve on their own — the ability to workwith other carriers to earn more revenue andreduce costs.SkyTeam: There are several political andeconomic hurdles that must be resolvedbefore industry consolidation can occur.Alliances, however, provide the benefits ofcooperation by allowing members to improvetheir market positioning, reach new destina-tions, enhance customer service and enjoycost savings and knowledge sharing.

Yet, an alliance is only as strong as itsmembers. SkyTeam continues to move for-ward, generating great value for our cus-tomers and member airlines.Q: Do you anticipate any low-cost carriers

will ever join one of the existing major

alliances?

SkyTeam: A key element of theSkyTeam global network is the hub-and-spoke system, which provides unparalleledconnectivity and an outstanding method forcustomers to travel using members of the

industry

ascend 33

years ago, the alliance has shown significantgrowth. During this growth period, we havemaintained our customer focus by expandingflight options through our strong network of airport hubs, providing exclusive services to recognize frequent business travelers and make them feel special, and enhancingthe quality of service across all its member airlines.Star Alliance: We have grown as anetwork, maintained our position of leadershipin the industry and matured as an organization.As a result, we can more quickly develop newproducts while at the same time reap the bene-fits of synergies and resulting cost reductions.oneworld: We’ve doubled in size — ourfounding four members have been joined byfour others.

At the same time, our focus hasexpanded to many areas beyond the servicesand benefits we offer to passengers as ourmembers have rightly wanted to increase thevalue they gain from the alliance.Q: How does the current international reg-

ulatory environment affect the continued

development of alliances?

oneworld: Judging by some of their rul-ings on alliances recently, the regulators seemto take on board more nowadays the benefitsthat alliances can offer customers. The keyissue here is that all alliances are treated fairlyand equally.

SkyTeam: SkyTeam members have acommonly held position about the necessity tohave a unique set of rules pertaining to openskies. How the rules are applied is key. As analliance, we need to maintain the current openskies agreements.Star Alliance: The Star Alliance net-work has always operated successfully withinthe regulatory framework of the various agen-cies across the globe and will continue to doso in the future.Q: What are your plans for future expan-

sion — do you plan to invite new airlines

into your alliance?

Star Alliance: We continue to evalu-ate our network and hope to expand it in thoseareas of the world where we feel the need forgreater presence. With the integration of bothSouth African Airways and TAP Air Portugal in2005, we will substantially improve the qualityof our network, especially in Europe, Africaand Latin America, and offer a total of morethan 15,000 daily departures to 833 destina-tions in 152 countries. By implementing ourregional member concept, Star Alliance willfurther enhance its network presence intomore markets. This will occur in Finland onceour first regional carrier, Blue1, joins. Ofcourse, both China and India remain as two ofthe key markets that are of great interest to us.oneworld: Where they can add benefit toour customers and existing members, we will

certainly invite airlines to join us. Our member-ship door is very definitely not closed.SkyTeam: Because SkyTeam’s missionis driven by customer needs, we continue toconsider a select number of airlines that willexpand the reach and benefits for our cus-tomers around the globe.

As mentioned above, this fall, we addedthree new carriers — Continental Airlines,KLM Royal Dutch Airlines and NorthwestAirlines.

In May, SkyTeam signed an agreementwith Aeroflot as a preliminary step in the newmember process. The agreement outlinesAeroflot’s intentions to undertake exclusivediscussions to become a part of SkyTeam. Inthe last five years, Aeroflot has made signifi-cant progress as far as its Russian domesticnetwork, renewal and improvement of itsfleet, its in-flight product and hub at MoscowSheremetyevo. Today, Aeroflot is undergoinga process that will ensure it will meetSkyTeam requirements in terms of quality ofservice and organization so that it can effec-tively join our alliance.

In August, SkyTeam signed an agree-ment with China Southern Airlines, laying thegroundwork for the airline to officially join thealliance — an event to occur once ChinaSouthern fulfills SkyTeam’s requirements forquality standards. China is one of the fastestgrowing aviation markets and Guangzhou is

industry

T H E H I G H L E V E Lvıew News Briefs from Around the Globe

Who

Korean Air

What

Selected the Sabre ® AirCrews ® Crew

Management Suite to improve cabin

crew efficiencies and support end-to-

end crew management needs as a

part of an “innovative excellence”

strategy. During the last six years, the

airline has relied on the tracking and

scheduling capabilities of the suite to

help manage its cockpit crew. Utilizing

the entire AirCrews suite will enable the

carrier to effectively manage all

aspects of its crew management

operations.

Why

“The AirCrews suite has delivered

excellent results in the management

of our cockpit crew, from long-term

crew resource planning through day-

of-operations crew tracking,” said

S.M. Lee, vice president of information

technology for Korean Air. “With the

AirCrews suite, we can always be sure

of the efficient deployment of crew at

the minimum cost while maintaining

flight reliability and schedule integrity.

“By extending the AirCrews

suite to our cabin crew, we will be

able to further improve operational

efficiency and lower crew-related

costs,” Lee continued. “Our staff will

greatly benefit from the technology

from Sabre Airline Solutions, including

innovative tools like team rostering

and the Sabre ® AirCrews ® Crew

Connection. The technology will also

act as a catalyst for us to continue our

quest for innovative excellence.” a

The three main global airline alliances, together, comprise more than

35,000 daily departures — oneworld with 7,526, SkyTeam with 14,320

and Star alliance with more than 14,000.

Phot

os c

ourt

esy

of o

new

orld

, Sky

Team

, Sta

r A

llian

ce

one of the country’s most affluent regionswith promising growth opportunities. As ChinaSouthern’s main base, Guangzhou is also a keytransportation center in southern China. Thenew Guangzhou Baiyun International Airport,which opened earlier this month, will comple-ment SkyTeam’s strong hub network and fur-ther expand the alliance’s Asian offerings.China Southern is also preparing a new facilityin Beijing to serve customers.

Last year, SkyTeam announced that it isdeveloping an associate member concept thatwill allow smaller, regional carriers to join theSkyTeam network and provide customers withaccess to even more destinations around theworld. As we finalize this concept, we willhave several associate members to announce.Q: What criteria do you use to determine

which new carriers to invite to join your

alliance?

SkyTeam: As with all decisions, newmember invitations are discussed among theGoverning Board and agreed upon by unani-mous consent. Each new member must meeta stringent set of requirements prior to receiv-ing an invitation for membership.Star Alliance: They must be qualitycarriers with outstanding safety and servicereputations that enhance our network, productand service offering.oneworld: Any new recruit has to pass sixmembership benchmarks. They must:

Broaden and deepen our alliance’s networkin strategic world regions,Offer a high-quality product and service

levels consistent with the existing oneworldmembers,Enjoy strong brand awareness,Maintain high operational standards,Add value to both the alliance’s customersand its existing partners,Contribute positively to oneworld’s “man-ageable nature.”

Q: How involved is the process of joining

your alliance?

oneworld: Once it has been elected onboard as a member designate, any new recruitmust be able to offer the full range ofoneworld services and benefits before it canjoin. What this involves is spelled out in whatwe call our delivery requirements document.

One of our existing carriers will act as asponsor, to provide guidance and assistance tothe new recruit in this process, with our cen-tral alliance team supporting the overall pro-gram.

How involved this all is depends on howaligned the new recruit is with oneworld’s poli-cies, procedures and processes.SkyTeam: SkyTeam membershiprequirements comprise numerous factorsincluding customer service, safety levels andtechnology adaptability. All new membersmust live up to the alliance’s customer servicestandards and provide a consistent, high levelof quality for their passengers everywherethey fly.Star Alliance: There are a number oftechnical requirements that must be met;however, as agreed with our member carriers,

details on matters of governance cannot bedisclosed.Q: Are the current alliances the first step

in a worldwide airline consolidation?

Star Alliance: The benefits that comewith membership in an alliance, both in termsof increased revenue and reduced costs, cre-ate significant value and reduce the need forconsolidation.oneworld: Undoubtedly. But alliances willstill be able to provide big, consolidated air-lines with benefits and value that they cannotachieve on their own — the ability to workwith other carriers to earn more revenue andreduce costs.SkyTeam: There are several political andeconomic hurdles that must be resolvedbefore industry consolidation can occur.Alliances, however, provide the benefits ofcooperation by allowing members to improvetheir market positioning, reach new destina-tions, enhance customer service and enjoycost savings and knowledge sharing.

Yet, an alliance is only as strong as itsmembers. SkyTeam continues to move for-ward, generating great value for our cus-tomers and member airlines.Q: Do you anticipate any low-cost carriers

will ever join one of the existing major

alliances?

SkyTeam: A key element of theSkyTeam global network is the hub-and-spoke system, which provides unparalleledconnectivity and an outstanding method forcustomers to travel using members of the

industry

ascend 33

years ago, the alliance has shown significantgrowth. During this growth period, we havemaintained our customer focus by expandingflight options through our strong network of airport hubs, providing exclusive services to recognize frequent business travelers and make them feel special, and enhancingthe quality of service across all its member airlines.Star Alliance: We have grown as anetwork, maintained our position of leadershipin the industry and matured as an organization.As a result, we can more quickly develop newproducts while at the same time reap the bene-fits of synergies and resulting cost reductions.oneworld: We’ve doubled in size — ourfounding four members have been joined byfour others.

At the same time, our focus hasexpanded to many areas beyond the servicesand benefits we offer to passengers as ourmembers have rightly wanted to increase thevalue they gain from the alliance.Q: How does the current international reg-

ulatory environment affect the continued

development of alliances?

oneworld: Judging by some of their rul-ings on alliances recently, the regulators seemto take on board more nowadays the benefitsthat alliances can offer customers. The keyissue here is that all alliances are treated fairlyand equally.

SkyTeam: SkyTeam members have acommonly held position about the necessity tohave a unique set of rules pertaining to openskies. How the rules are applied is key. As analliance, we need to maintain the current openskies agreements.Star Alliance: The Star Alliance net-work has always operated successfully withinthe regulatory framework of the various agen-cies across the globe and will continue to doso in the future.Q: What are your plans for future expan-

sion — do you plan to invite new airlines

into your alliance?

Star Alliance: We continue to evalu-ate our network and hope to expand it in thoseareas of the world where we feel the need forgreater presence. With the integration of bothSouth African Airways and TAP Air Portugal in2005, we will substantially improve the qualityof our network, especially in Europe, Africaand Latin America, and offer a total of morethan 15,000 daily departures to 833 destina-tions in 152 countries. By implementing ourregional member concept, Star Alliance willfurther enhance its network presence intomore markets. This will occur in Finland onceour first regional carrier, Blue1, joins. Ofcourse, both China and India remain as two ofthe key markets that are of great interest to us.oneworld: Where they can add benefit toour customers and existing members, we will

certainly invite airlines to join us. Our member-ship door is very definitely not closed.SkyTeam: Because SkyTeam’s missionis driven by customer needs, we continue toconsider a select number of airlines that willexpand the reach and benefits for our cus-tomers around the globe.

As mentioned above, this fall, we addedthree new carriers — Continental Airlines,KLM Royal Dutch Airlines and NorthwestAirlines.

In May, SkyTeam signed an agreementwith Aeroflot as a preliminary step in the newmember process. The agreement outlinesAeroflot’s intentions to undertake exclusivediscussions to become a part of SkyTeam. Inthe last five years, Aeroflot has made signifi-cant progress as far as its Russian domesticnetwork, renewal and improvement of itsfleet, its in-flight product and hub at MoscowSheremetyevo. Today, Aeroflot is undergoinga process that will ensure it will meetSkyTeam requirements in terms of quality ofservice and organization so that it can effec-tively join our alliance.

In August, SkyTeam signed an agree-ment with China Southern Airlines, laying thegroundwork for the airline to officially join thealliance — an event to occur once ChinaSouthern fulfills SkyTeam’s requirements forquality standards. China is one of the fastestgrowing aviation markets and Guangzhou is

industry

T H E H I G H L E V E Lvıew News Briefs from Around the Globe

Who

Korean Air

What

Selected the Sabre ® AirCrews ® Crew

Management Suite to improve cabin

crew efficiencies and support end-to-

end crew management needs as a

part of an “innovative excellence”

strategy. During the last six years, the

airline has relied on the tracking and

scheduling capabilities of the suite to

help manage its cockpit crew. Utilizing

the entire AirCrews suite will enable the

carrier to effectively manage all

aspects of its crew management

operations.

Why

“The AirCrews suite has delivered

excellent results in the management

of our cockpit crew, from long-term

crew resource planning through day-

of-operations crew tracking,” said

S.M. Lee, vice president of information

technology for Korean Air. “With the

AirCrews suite, we can always be sure

of the efficient deployment of crew at

the minimum cost while maintaining

flight reliability and schedule integrity.

“By extending the AirCrews

suite to our cabin crew, we will be

able to further improve operational

efficiency and lower crew-related

costs,” Lee continued. “Our staff will

greatly benefit from the technology

from Sabre Airline Solutions, including

innovative tools like team rostering

and the Sabre ® AirCrews ® Crew

Connection. The technology will also

act as a catalyst for us to continue our

quest for innovative excellence.” a

The three main global airline alliances, together, comprise more than

35,000 daily departures — oneworld with 7,526, SkyTeam with 14,320

and Star alliance with more than 14,000.

Phot

os c

ourt

esy

of o

new

orld

, Sky

Team

, Sta

r A

llian

ce

same alliance from their departure city to anylocation in the world. A majority of theworld’s low-cost carriers focus on point-to-point travel and thus would not enhance ourglobal network. However, several membershave relationships with low-cost carriers,and those relationships benefit our passen-gers since most are both business andleisure travelers.Star Alliance: The business modelsand product lines of network carriers andlow-cost carriers are not compatible, particu-larly when you consider that global accessand network connectivity are fundamentalparts of our business.oneworld: They already have.

Aer Lingus has transformed itself into alow-cost carrier since it joined oneworld fouryears ago. The no-frills subsidiaries of someother legacy carriers who are members of othergroupings are also affiliates of those alliances.

Some low-cost carriers offer a betterlevel of service and network than some oftheir traditional counterparts. As they grow fur-ther, more are likely to see that global alliancecan provide them with benefits while stillenabling them to maintain their cost focus.Q: Do you think the membership of

alliances will remain stable for the most part,

or do you ever expect to see movement of

members from one alliance to another? Is

there anything to prevent member airlines

from moving to another major alliance?

oneworld: Companies in shipping formedalliances long before airlines. That industry hasshown that the more members you have in analliance, the less stable it becomes. That isone reason why oneworld has maintained ourmembership at manageable levels.

Some alliances have already lost mem-bers. For example, Canadian Internationalwas forced to leave oneworld when the airline

was taken over by Air Canada. So there may well be some further movement, but thecore membership is likely to remain stable.SkyTeam: Members of the SkyTeamalliance have strong ties with each other, andmany member carriers have relationships witheach other that have spanned decades, datingto before the alliance was formed.

The foundation of a successful allianceis its ability to maximize and maintain benefits

for member airlines — helping membersoffer a better product for their customers,develop their business, benefit from costsavings, etc. During the past four years,SkyTeam has proven its ability to do justthat, making it an attractive allianceprospect for many carriers. As stated previ-ously, SkyTeam continues to consider newmembers in key regions, such as SoutheastAsia and South America. In addition, the

alliance is implementing an associate member program and expects to announcethe first SkyTeam associate members next year.Star Alliance: A membership in StarAlliance needs to be a win-win situation forthe carrier and the alliance as a whole. Inother words, as long as a member carriersees the value of being in the alliance, therewill be no need to move elsewhere. a

ascend 35

industry

T H E H I G H L E V E Lvıew News Briefs from Around the Globe

WhoAir Andaman

What

Selected the SabreSonic ™ Passenger

Solutions to power its regional growth

strategy by providing a reliable,

scalable and flexible information

technology solution that will enable

the carrier to adapt quickly as its

business model evolves.

Why“In the first year of operation, Air

Andaman is expecting significant pas-

senger volumes due to interline and

codeshare partnerships we have

established, and we are forecasting

significant year-over-year growth in

passengers boarding,” said Dean

Mills, president of Air Andaman.

“To support this future growth, we

selected the SabreSonic solutions as

it is a best-of-breed solution with the

most advanced functionality of any

on the market. We recognize that the

reservations and departure control sys-

tems are the core of all our opera-

tions, and we’re confident the

SabreSonic solutions will help us

reduce operational costs, improve

efficiency and enhance our customer

service.” a

Finland’s Blue1 will become

the first regional carrier to join

the Star Alliance thanks to spon-

sorship by its parent company,

SAS, a current member

of the alliance.Phot

o co

urte

sy o

f S

tar

Alli

ance

Cathay PacificHong Kong

LOT Polish AirlinesWarsaw, Poland

British AirwaysLondon, England

Aer LingusDublin, Irelannd

FinnairHelsinki, Finland

American AirlinesFort Worth, Texas, USA

Air New ZealandAuckland, New Zealand

QantasSydney, Austrlia

AlitaliaRome, Italy

Scandinavian AirlinesStockholm, Sweden

Thai AirwaysBangkok, Thailand

Singapore AirlinesSingapore, Singapore

All Nippon Airways (ANA)Tokyo, Japan

AustrianVienna,Austria

SkyTeam

Star Alliance

oneworld

IberiaMadrid, Spain

Air France-KLMParis, France and Amsterdam,

The Netherlands

Northwest AirlinesSt. Paul, Minnesota, USA

CSA Czech AirlinesPrague, Czech Republic

Continental AirlinesHouston,Texas, USA

industry

LANSantiago, Chile

AeroméxicoMexico City, Mexico

Delta Air LinesAtlanta, Georgia, USA

Korean AirSeoul, South Korea

United AirlinesChicago, Illinois, USA

Air Canada Montreal, Quebec, Canada

US Airways Arlington, Virginia, USA

VARIGRio de Janeiro, Brazil

bmiDerby, United Kingdom

LufthansaFrankfurt, Germany

SpanairPalma de Mallorca, Spain

Asiana AirlinesSeoul, South Korea

Members of oneworld, SkyTeam and Star

Alliance have headquarters in 32 cities

around the world.

+count it up1942 — Year Ellen Church became the world's first flight attendant. Prior to becoming a flight attendant for United Airlines,

Church served in World War II as an on-board nurse, providing medical care for wounded soldiers.

same alliance from their departure city to anylocation in the world. A majority of theworld’s low-cost carriers focus on point-to-point travel and thus would not enhance ourglobal network. However, several membershave relationships with low-cost carriers,and those relationships benefit our passen-gers since most are both business andleisure travelers.Star Alliance: The business modelsand product lines of network carriers andlow-cost carriers are not compatible, particu-larly when you consider that global accessand network connectivity are fundamentalparts of our business.oneworld: They already have.

Aer Lingus has transformed itself into alow-cost carrier since it joined oneworld fouryears ago. The no-frills subsidiaries of someother legacy carriers who are members of othergroupings are also affiliates of those alliances.

Some low-cost carriers offer a betterlevel of service and network than some oftheir traditional counterparts. As they grow fur-ther, more are likely to see that global alliancecan provide them with benefits while stillenabling them to maintain their cost focus.Q: Do you think the membership of

alliances will remain stable for the most part,

or do you ever expect to see movement of

members from one alliance to another? Is

there anything to prevent member airlines

from moving to another major alliance?

oneworld: Companies in shipping formedalliances long before airlines. That industry hasshown that the more members you have in analliance, the less stable it becomes. That isone reason why oneworld has maintained ourmembership at manageable levels.

Some alliances have already lost mem-bers. For example, Canadian Internationalwas forced to leave oneworld when the airline

was taken over by Air Canada. So there may well be some further movement, but thecore membership is likely to remain stable.SkyTeam: Members of the SkyTeamalliance have strong ties with each other, andmany member carriers have relationships witheach other that have spanned decades, datingto before the alliance was formed.

The foundation of a successful allianceis its ability to maximize and maintain benefits

for member airlines — helping membersoffer a better product for their customers,develop their business, benefit from costsavings, etc. During the past four years,SkyTeam has proven its ability to do justthat, making it an attractive allianceprospect for many carriers. As stated previ-ously, SkyTeam continues to consider newmembers in key regions, such as SoutheastAsia and South America. In addition, the

alliance is implementing an associate member program and expects to announcethe first SkyTeam associate members next year.Star Alliance: A membership in StarAlliance needs to be a win-win situation forthe carrier and the alliance as a whole. Inother words, as long as a member carriersees the value of being in the alliance, therewill be no need to move elsewhere. a

ascend 35

industry

T H E H I G H L E V E Lvıew News Briefs from Around the Globe

WhoAir Andaman

What

Selected the SabreSonic ™ Passenger

Solutions to power its regional growth

strategy by providing a reliable,

scalable and flexible information

technology solution that will enable

the carrier to adapt quickly as its

business model evolves.

Why“In the first year of operation, Air

Andaman is expecting significant pas-

senger volumes due to interline and

codeshare partnerships we have

established, and we are forecasting

significant year-over-year growth in

passengers boarding,” said Dean

Mills, president of Air Andaman.

“To support this future growth, we

selected the SabreSonic solutions as

it is a best-of-breed solution with the

most advanced functionality of any

on the market. We recognize that the

reservations and departure control sys-

tems are the core of all our opera-

tions, and we’re confident the

SabreSonic solutions will help us

reduce operational costs, improve

efficiency and enhance our customer

service.” a

Finland’s Blue1 will become

the first regional carrier to join

the Star Alliance thanks to spon-

sorship by its parent company,

SAS, a current member

of the alliance.Phot

o co

urte

sy o

f S

tar

Alli

ance

Cathay PacificHong Kong

LOT Polish AirlinesWarsaw, Poland

British AirwaysLondon, England

Aer LingusDublin, Irelannd

FinnairHelsinki, Finland

American AirlinesFort Worth, Texas, USA

Air New ZealandAuckland, New Zealand

QantasSydney, Austrlia

AlitaliaRome, Italy

Scandinavian AirlinesStockholm, Sweden

Thai AirwaysBangkok, Thailand

Singapore AirlinesSingapore, Singapore

All Nippon Airways (ANA)Tokyo, Japan

AustrianVienna,Austria

SkyTeam

Star Alliance

oneworld

IberiaMadrid, Spain

Air France-KLMParis, France and Amsterdam,

The Netherlands

Northwest AirlinesSt. Paul, Minnesota, USA

CSA Czech AirlinesPrague, Czech Republic

Continental AirlinesHouston,Texas, USA

industry

LANSantiago, Chile

AeroméxicoMexico City, Mexico

Delta Air LinesAtlanta, Georgia, USA

Korean AirSeoul, South Korea

United AirlinesChicago, Illinois, USA

Air Canada Montreal, Quebec, Canada

US Airways Arlington, Virginia, USA

VARIGRio de Janeiro, Brazil

bmiDerby, United Kingdom

LufthansaFrankfurt, Germany

SpanairPalma de Mallorca, Spain

Asiana AirlinesSeoul, South Korea

Members of oneworld, SkyTeam and Star

Alliance have headquarters in 32 cities

around the world.

+count it up1942 — Year Ellen Church became the world's first flight attendant. Prior to becoming a flight attendant for United Airlines,

Church served in World War II as an on-board nurse, providing medical care for wounded soldiers.