ICT and e-business in the tourism industry ICT adoption ... - empirica

Tourism
terms of a considerable reduction in mishandled baggage and provide new security
requirements; increase baggage handling; reduce interline baggage tag read errors as
RFID technology does not require contact or direct line-of-sight, as is the case with
current optical read technology; allow the identification of bags in a baggage container
that cannot be scanned by an optical scanner; and reduce the costs of manual encoding
of interline baggage tags as the result of tags that failed to be scanned automatically by
the system.
Currently, IATA is conducting a pilot project with key airlines and airports worldwide. The
goal of this project is to measure and validate the interoperability of the technology, the
processes associated with RFID, as well as all costs and benefits associated with the
new technology. Back in 2004, IATA undertook a study to determine how to best
implement RFID technology industry-wide. The key findings of this study were:
“RFID technology is a catalyst for change and a good focus for baggage handling
performance improvements. RFID technology is to run parallel to the existing bar
code technology for the foreseeable future. An RFID pilot is essential prior to an
industry-wide rollout. Although there are strong arguments for RFID for baggage
management, today here is insufficient data on costs and hard benefits currently
available to support robust business cases either for individual airlines
implementations or at the overall industry level. Ad hoc, individual attempts to
introduce RFID will not lead to a solid, integrated industry-wide solution. The
current perception is that tag costs are too high (0.20 US dollars) and will have to
drop well below this level for adoption.” (www.iata.org)
Other developments regarding luggage handling may be quite unexpected, or innovative
in a way that nobody would have foreseen. Peter M. Burns describes this latest
innovation by Ryanair:
“Low Cost Airline ‘Bans’ Hold Luggage: Ryanair is one of the leading innovators in
air transport through its policies of cheap fares with a ‘no frills’ business model. The
latest attempt at innovation and creative thinking (July 2004) is a proposal to
charge passengers 5 British Pounds fee for handling checked-in baggage. The
idea is that Ryanair could negotiate lower ground handling fees at airports if there
was no hold-baggage to handle. The business model would be to allow
passengers a reasonably large bag that fits into the overhead locker along with
electronic purchase of tickets and check in.” (Burns 2006)
As described in detail in the case study on Ryanair, the low cost carrier put this plan into
practice in March 2006.
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