October last year saw the definition of the new standard where the airlines will be allowed to ask customers searching for airfares for their names, frequent flier numbers, contact details and other information before showing the prices. This is applicable to searches through travel agent or websites.
The International Air Transport Association (IATA) calls it “new distribution capability“, which is a way for airlines to personalize services for their customers. Most of the members, comprising of 240 airlines, have agreed to adopt this for distributing airfare information, and this could compromise the privacy of customers and, most importantly, allow carriers to charge travelers different prices for the same trip.
Some of them have already tested the system in the last few months and more airlines are expected to adopt them in the coming months or years.
Depending on the time and day of the purchase, and the destinations, most airlines already charge different fares. And if you are a frequent flyer with that airlines, then a free first bag, a free aisle seat and perhaps some discount is offered too. Taking a step further, customers who fly frequently with any particular airline may see higher prices. For instance, a business traveler with an airline, traveling between Los Angeles and Houston every week will see a higher price in fares just because (s)he can afford it.
Of course, you will still be able to browse anonymously, but you may see a higher price that if you were to search as a frequent flyer. This is a way for the airlines to sign you up for their frequent flyer programs.
Federal regulators like the Department of Transportation in U.S. has the authority to regulate and monitor unfair and deceptive practices. They should also implement better privacy policies to safeguard customers personal information. The European Union has tougher standards and laws on privacy as compared to the U.S. and other countries. But none of these agencies have studied the new standard yet. Which makes us wonder where do we go from here?