Airline Reservations Systems: Lessons From History

Abstract

This article discusses the evolution of airline reservations systems—from their inception as manually maintained inventories of seat availability, through their description as “anticompetitive weapons” used “unlawfully” to obtain and exercise monopoly power. The evolutionary perspective reveals interdependent industry, company, and technology forces that shaped the pattern of competition. Although many facets of the airline experience are unique to the air transport industry, the authors identify three features with broad implications for the strategic use of information technology. First, large installed processing capacity can be a source of economies of scale and scope. Second, established technical competence is a necessary requirement for gaining competitive advantage. Finally, sustainable advantage need not be the result of extraordinary vision, but the result of consistent exploitation of opportunities revealed during the evolution of adaptable systems.