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November 28, 2011

Harmonised fares systems are the ticket to success

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THE lack of integration between national booking systems can be a major obstacle to cross-border rail travel. Philip Martin, head of marketing for Amadeus Rail tells Keith Barrow why standardising distribution networks will be a crucial step towards achieving the European Commission’s targets for increasing rail’s modal share.

The dramatic eruption of Icelandic volcano Eyjafjallajökull last April gave rail operators in Europe a unique opportunity to demonstrate the advantages of rail to passengers who, in many cases, rarely travel by train. With flights grounded for six days, many air passengers switched to international rail services to complete their journeys. Operators across Europe reacted swiftly, running additional trains to meet the surge in demand.

While this was undoubtedly a public relations success, many regular air passengers were reminded how difficult it can be to obtain information about international train journeys and the challenges of booking tickets involving multiple operators. Mr Philip Martin, head of marketing for Amadeus Rail (pictured), argues that an integrated journey planner would have been invaluable in this situation. "The Icelandic volcano illustrated how inadequate the current system is in terms of international journey planning," he says.
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"The continuing absence of an integrated journey planner is a stumbling block. Railways need to share information externally with third parties, and in turn provide the traveller with the ability to actually find rail travel."

One of rail's key competitive weaknesses is its inability to compete with other modes at the point of booking. "Railways need to apply much more pressure at travel decision time, the time when people need to be able to see rail as a viable choice for their journey," says Martin. "In its White Paper, the European Commission (EC) said there must be more cooperation between rail operators to make this sort of thing work effectively. The first step must be to conquer rail-to-rail connectivity, and a large-scale distribution system can join things up. It's a question of embracing the needs of the traveller. If a booking process is seen to be difficult, the journey will be perceived as difficult as well."

Martin argues that European rail operators should be looking to emulate the success of the three major aviation alliances - Star Alliance, Oneworld and Skyteam - which have expanded to encompass dozens of airlines serving hundreds of destinations around the world. The Railteam alliance launched amid much fanfare in 2007 has so far achieved little in the way of integration. "Alliances between operators may be the way to go, but they need to be on a grander scale than what has been done so far if they are to offer an accessible product that takes full advantage of an expanding high-speed network," says Martin.

The Telematics applications for passenger services TSI (TAP-TSI) recently adopted by the European Commission may go some way towards standardising rail distribution systems and simplifying interfaces between operators, ticket vendors, and other transport modes.

Martin suggests establishing common standards like this will encourage harmonisation and interoperability, as they have already done in other sectors. "The air, hotel and car hire industries all sell their products in a standardised way, and they all agree on a way to do this successfully, with multiple sales channels making booking accessible to the customer," says Martin.

"The TSI will bring rail into a larger distribution system encompassing these industries and that will make things much easier. The new standards will make it much easier to integrate a rail element into a passenger journey that involves a bus connection, car hire or a flight."

An important characteristic of the TSI is that it requires the display of other modal options in a standardised format, making a direct comparison between rail with air much more straightforward. "Once information is open and available, the global distribution system can work with it," says Martin.

Some commentators have argued that liberalisation and the European Union's focus on fostering a competitive rail market has stymied any possibility of integrating booking systems, but Martin suggests the opposite is true. "Competition actually accelerates the opportunities to profit from collaboration on distribution systems," he says. "The faster you get standards in place, the quicker you can build alliances and get the product working properly before your competitor enters the market. In the context of open-access, distribution will be critical for rail - operators will need to get their products to their customers at the right time and in the right place."

Automating and centralising distribution allowed airlines to concentrate on serving customers, which in turn led to greater competition and better customer service. Airline alliances share information about customers to ensure they are treated consistently around the globe, and Martin argues rail should make the same transition. "There would need to be a phased plan to move to a community model to reach the level of integration achieved by the airlines," he says. "The reward for doing this would be an enormous distribution network. Technology can transform the system for both the passenger and the operator."

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