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Delta and Travelport Agree to Transfer Passenger Service, Flight Operations Software Responsibility; Companies Commit to New, Long-Term Infrastructure Hosting Services Agreement

May 23, 2014 Tech No Comments Email Email

Delta Air Lines (NYSE: DAL) and Travelport finalized an agreement in which Delta will reacquire the data and intellectual property rights central to its passenger service and flight operations systems.

As a result, Delta will be the only U.S. airline to directly control these critical technology systems, making it better able to build the next generation of technology that will improve the travel experiences of its customers.

The move is the latest innovation in Delta’s continued effort to rethink and reshape the airline business. Earlier this year, Delta announced industry-leading changes to its SkyMiles frequent flyer program to differentiate it for premium travelers, Delta also has made strategic investments in Virgin Atlantic Airways, AeroMexico and GOL over the last several years; created Monroe Energy to provide 80 percent of its annual domestic fuel needs; transformed its fleet strategy including a significant reduction in 50-seat aircraft; and invested billions of dollars to improve the customer experience including investments to facilities in Atlanta, New York, Los Angeles and Seattle since 2010.

“These systems are the data and operational backbone for more than 180 technology applications used to run our airline every day,” Richard Anderson, Delta CEO said. “By bringing the systems along with the highly skilled people who support them under Delta’s direct management, we gain greater flexibility and control over the technology enhancements that will continue to improve our operational performance and passenger experience.  This transaction builds on our ongoing efforts to build a stronger airline for our shareholders, employees and customers while reconfirming the importance of our strategic partnership with Travelport.”

The agreement between Travelport and Delta will aid Delta’s continued effort to rethink and reshape the airline business through the following:

  • Transfer of direct control and operations for Delta’s passenger service systems and flight operations systems.
  • A transition of the development software which does not require a technology migration event so there is no effect to Delta customers.
  • Travelport will continue to be a key partner with Delta. Travelport will continue to run the system infrastructure for the Delta platform in its Atlanta data center. The transition of more than 175 technology professionals to Delta effective July 1.
  • No impact on Delta and Travelport’s existing Global Distribution Systems agreement which was previously renewed in 2013.

“Having successfully assisted Delta through its transition onto these systems after its merger with Northwest Airlines, it is a natural next step to move this activity back under Delta,” said Gordon Wilson, Travelport CEO.  “In the meantime, Travelport and Delta have consummated a new long-term hosting agreement whereby Travelport will continue to run the systems infrastructure and hosting for the Delta platform in our Atlanta datacenter on our hardware and with our systems monitoring and support. This is testament to the high levels of service, expertise and customer orientation that Delta sees in Travelport. It also underscores the massive credibility and reliability that Travelport has delivered to Delta over the years and which Delta wants to continue to benefit from running forward.”

The previous arrangement whereby Travelport personnel, who are predominantly located in Atlanta, worked exclusively on the Delta passenger service and flight operations software dates back  to when Delta was an owner of the Worldspan system which Travelport acquired in 2007. The agreement between Travelport and Delta allows each organization improved ability to focus on the core business functions necessary to run their respective organizations efficiently.

The financial terms of the agreement have not been disclosed.

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