Roshan Mendis
ABACUS International has been absorbed into a Sabre Travel Network Asia-Pacific and its CEO of seven years, Robert Bailey, leaves on July 7, but Sabre’s new regional head honcho, Roshan Mendis, stopped short of saying the GDS will be rebranded as Sabre.
Two hours into his job as senior vice president, Sabre Travel Network Asia-Pacific, Mendis, who worked previously with Travelocity and Zuji, talked to Raini Hamdi this morning about what’s in store for agencies as Sabre completed its full acquisition of Abacus yesterday (July 1), well ahead of the September expectation earlier. Here are key excerpts:
First, let me understand your role. Does this mean Abacus is being rebranded as Sabre?
My appointment means Sabre takes this business and this region very seriously. It’s an incredible asset, an important acquisition, a region that is going to be the fastest-growing for a long time to come and probably, the biggest region for Sabre in time to come.
Secondly, it means we will find the ideal combination of Abacus assets (like local knowledge) and the business, expertise and product innovation we have globally at Sabre. How that translates to products, brands, etc, is yet to be determined. I’m two hours into the job.
You won’t commit that Abacus will be rebranded as Sabre but would you say that’s a possibility?
Yes, it is a possibility.
Does that mean Hans Belle, Sabre vice president/general manager Asia-Pacific, will be made redundant?
He will continue in an important role in Sabre Travel Network Asia-Pacific. The business in Asia-Pacific was managed through the Abacus partnership and Robert (Bailey) did a large part of the job. With the full acquisition, the previous Abacus CEO job becomes broader in that it manages all Sabre Travel Network assets in Asia, including Abacus.
In our article, Sabre-rattling?, agencies who are your customers here are watching to see if the acquisition will ‘rock the boat’. Continuity is an issue. So my question to you is, will there be a lot of other changes?
I understand those concerns, and my job and the team’s job over the next few months will be to address those concerns.
The best evidence of that not being a concern, though, is that Sabre has been providing the core technology and product to Abacus customers for the last 17 years. So the crux of the business – the system that agencies log on to everyday – is the Sabre system and that is not going to change. So it is an acquisition that is incredibly well-suited for a smooth transition and one where the customers will feel very little, if nothing, in the transition.
Now, over time, we hope to make things better – in the products we can bring to Asia, the knowledge we can bring to the product development team at Sabre, and providing agencies and suppliers a much more global proposition. As you know, the regional travel agencies or the country-specific agencies are moving rapidly out of the geographies they are born in; Chinese agencies are moving out of China and competing in the rest of the world; Indian agencies are moving into the Middle East and other parts of the region, so having a business and set of products that allow them to compete beyond their immediate borders is of value and that is immediately possible now with Abacus becoming an integral part of Sabre.
Can you give me a simple example why it is possible now?
Sabre’s involvement in the running of Abacus before the acquisition was via its seats around the Board of Directors’ table. Today, it’s every email, every call, every customer meeting (because of its full ownership). Now translate that into real-time decision-making and how that improves product development, customer service operations. Even though it’s a subtle change, it’s a material change.
Are you worried about Abacus’ declining marketshare?
Well, 40 per cent is an enviable marketshare number! Has that moved over the last 10 years or so? Sure it has, as markets evolve and different ones grow at different rates. We are the largest player and growing at a rate above market. We are happy where the business is and the business we have acquired but we think there is more potential in the region to grow with the market and we believe with Sabre ownership and involvement, and Abacus engagement, we can even grow ahead of the market.
How is the structure of your NMCs (National Marketing Companies) going to change?
As part of the acquisition, we bought all the relationships that Abacus has with the NMCs. We are going through a process of understanding which NMCs we want to work with more directly and which ones we will work with a JV, airlines or non-air distributors. We have some internal criteria that we use, to understand if we are better able to compete by owning the NMC or through a JV.
How are your long-term agreements with the airlines different from before?
They are materially different, as the airlines are no longer owners. Outside of that, as part of the deal we have struck with the airlines in the acquisition, we will continue to get all the support in terms of fares, products, marketing support, etc, that we enjoyed before.
But as the airlines no longer own Abacus, they can now give that kind of support to your competitors too.
I don’t think that’s something we’re particularly concerned about. Depending on their distribution objectives, have the relationships they want to have with the other GDSs. We will be focused on the relationship they will have with us.
Do you see opportunities to increase fees charged to airlines now they are no longer your owners?
This acquisition is not about that. It’s about differentiating ourselves through product and service and bringing the best of our products to the region and using the Abacus assets to get local insights so that we can be a much more Asian-ised business at a global level.
Is there an opportunity to increase incentives for agencies so they book you more?
Incentives are only one dimension of the competition. Travel agencies value incentives, product, service, relationships, as you pointed out in your article. We will compete across all those dimensions.
Six months from now if you look back, what would you like to have achieved?
I would like to have met all our 600 employees, talked to them and learnt all about the business. I would like to have met a large number of our agency customers and supplier customers and understood their aspirations, plans and businesses. And I would like to have a clear sense of how Sabre will set ourselves up to support those ambitions. If we successfully do all those things, and I intend to do them, we will be set for a very nice run in the Asia-Pacific region.
