This document provides an overview of the airline IT solutions landscape in Latin America. It discusses the main stages of the passenger sales process and identifies the major providers of solutions in each area, such as reservations, inventory, pricing, loyalty programs, and ancillary revenues. It analyzes the competitive environment and market penetration of different providers across segments like major airlines, low-cost carriers, and small-to-medium airlines in each Latin American country. Technological trends in mobile services, customer relationship systems, and cloud computing are also examined. The document concludes with estimates of market penetration opportunities for providers like Hitit in both replacing existing core systems and expanding with additional specialized solutions.

1. DGL & Asoc – Consultora Aeronáutica - SABUTAI TECNOLOGIA
Jorge De Buono – Diego Garcia Laborde – Fernando Lifsic
IT&T AIRLINE SOLUTIONS
LATAM ENTRY STRATEGY
Products - Providers and Solutions
February 2012

2. Understand the Competitive Environment in LATAM
Brief introductions of products, providers and solutions
There are 12 or more stages in the passenger sales process. Starting from market intelligence to the relatively new element
of generating ancillary revenues.
There are numerous systems and solutions available to the world’s airlines from several dozen suppliers. In LATAM some of
there are present.
Market Forecast
The first stage in passenger sales is market forecasting, which involves analysing competitors’ schedules, capacities and fares
to gain intelligence about a market’s size.
The main providers of solutions in this field ( MIDT ) are Amadeus, Lufthansa Systems, Sabre, SITA and Travelport. Only some
mayor carriers in Latam has application on this.
Reservations & Inventory - E-ticketing - Check-in & Departure Control
Amadeus and Sabre offers several products for reservations and inventory control, subdivided into: direct sales channels and
airline websites; and off-line channels, such as travel agents, call centers and airline offices. Ticketing is closely associated
with reservations, the majority of Latam airlines use e tickets.
Check-in and the DCS as one of the core functionalities of the passenger sale and handling process, it is offered by all the large
vendors. Have been developed in recent years to include more ways of checking passengers, including self service kiosks and
web-based check-in.
Some airlines in Latam ( no many ) are now using check-in and departure-lounge time as opportunities to market and sell
additional products and services offered by themselves and third parties to passengers. This includes ancillary revenue
services, so DCS systems have to communicate with these modules as well.
For that reason it is recommended that the DCS platform include complete solutions of check-in modules including desk, web,
kiosk and mobile check-in, as well as a passenger boarding system.
If possible the airlines should be able to choose modules or the complete integrated suite and related solutions. There is a
reasonable opportunity to give DCS solution in Medium and Small airlines.
In largest airlines chances are lower in Core Systems ( Booking – DCS – TKT )
Distribution ( web )
Several forms of distribution have evolved over recent years. In addition to the traditional GDSs, airlines now distribute their
products directly via their websites and indirectly via OTAs . The large providers in LATAM of traditional GDSs are Amadeus
and, Sabre.
Web distribution was implemented by most of the airlines in the last 4 years, and continue the improvements.
Pricing & yield management
RM ( Revenue management ) and pricing is one of the most complex and specialized processes in passenger sales, so there
are few vendors that provide solutions.
Navitaire offers its SkyPrice solution for RM, while revenue and yield management is an integral part of HITIT’s CranePax
product. Both have not presence in LATAM
Revenue integrity & leakage
Revenue integrity or protection is the process of ensuring that the correct fares and pricing rules have been applied, and th at
fake and unticketed bookings, or double bookings that are unlikely to be ticketed, are cancelled
Amadeus has robots that clean up inventory. These analyze all bookings to verify that correct fare rules have been used, and
search for bookings with fake or suspect names, and bookings in the same name on the same or close flights
Customer loyalty CRM -
Customer loyalty involves FF programmes and customer relationship management (CRM). Solutions are provided by the large
vendors, as well as specialist providers. In Latam there are several providers on market and in general do not offer CRM
solutions.

3. Majority of Largest LCC in LATAM do not offer frequent pax programs.
Amadeus offers two products for FF Programmes: Customer Loyalty for small and medium-sized airlines; and BLS for large
airlines. Both products manage FF points in terms of record-keeping, allowing and monitoring usage. ( Amadeus does not
have a CRM product, although its Altea Reservation system does use ranking from other CRM systems to adapt treatment of
customers ).
HITIT’s with Crane FF, has a large opportunity in Latam included Crane 4C CRM, which allows airlines to track every piece of
passenger correspondence so that passengers get a response to all communication with the airline.
HITIT with Crane Intelligent Member Profiles (IMP) have a competitive advantage in the market
Revenue accounting
Revenue accounting is a module provided by some, mainly big, vendors, but also a few specialists. Like DCS, it is a core part of
the traditional passenger sales process.
As integrated solution there are opportunities in the Latin American market.
Business intelligence
Business intelligence, the process whereby an airline collects data on its own sales, revenues and passenger statistics and
uses them to provide information on its performance there is not very developed in Latam ( specially in medium and small
airlines ).
This is a specialized service offered by a few vendors in latam ( ie Calidris, which offers specialized revenue integrity and
leakage solutions, also provides its business intelligence service Calidris Intelligence ).
Ancillary revenues
The major solutions vendors installed in Europe , USA and Asia now provide airlines with websites for checking schedules,
seat and fare availability, making reservations, and completing transactions. They have since developed the ability to offer e-
commerce and dynamic packaging technology to airlines, as well as systems for ancillary products, which include pricing rules
and product inventory and availability information and data.
AirSavings as a specialist provider of ancillary revenue solutions is pushing on Latam market. Offer Its Airline Plus product as
an aggregation platform for selling third-party products, and also provides dynamic packaging capability.
AirSavings also offers Privilege Outlet, which invites passengers to an event on the internet, typically offering goods at
discounted prices for a limited period.
Farelogix it´s another specialist solutions provider, which launched its FMS2 product in January 2009 in Latam . FMS2 is a
web-based business-rules engine for the different products an airline offers.
Modern technology that enables airlines to generate additional revenue will be the key in LATAM market.
HITIT should consider offering it by himself or through an strategic partner.

4. Technological trends. Brief
The priority investments on IT&T of mayor and medium LATAM airlines ( Full Services or LCC ) are focus on Improving
customer service , Supporting revenue opportunities and Reducing cost of business operations. Most airlines are planning to
invest in mobile passenger services. The outlook remains positive, expecting IT&T spend to increase in 2012
Mobile services top the investment priority list, with a 40% increase in the number of airlines planning major investments in
the passenger area, compared to last year. Passenger processing such as check-in, flight status notifications and electronic
boarding passes are the main focus, while travel distribution via mobile phones is also on the rise.
Upgrades to airline core passenger management and customer relationship systems will also receive significant investments
over the next years.
IT&T investment programs in the next years Major Programmes R&D/pilot No plan
Mobile device based services for passengers 27 30% 43%
Integrating electronic documents (e.g. EMD, aircraft parts, boarding passes) 34% 16% 50%
Upgrade core passenger management system 47% 16% 37%
Improve direct customer relationship system functionality ( CRM ) 44% 39% 17%
Mobile device based services for staff ( ei YADA )
26% 16% 58%
As we know mobile phones are set to become a significant sales channel in the future. However few LATAM airlines are
actively involved right now. Only major airlines are planning to sell tickets on mobile phones by 2014.
In addition, these major airlines plan to extend mobile distribution services and sales onboard services.
Airlines are also looking to add new sales channels. Kiosks and social network sites are the latest addition to a growing
channel mix. Early adopters are already integrating social media sites in the sales process. 40 % of total airlines sell or plan to
sell tickets via social media networks by 2014.
As in the rest of the world, 15 % of regional passengers expected to use mobile phones for check-in. Airlines has just begun to
reduce agent-led passenger operations in favour of more self-service options.
Check-in via Internet is usual all over, and mobile phones, are predicted to grow fastest in major airline segment.
Strategy for kiosks 40 %
No kiosks and no plan to implement 40 %
Increase total number of check-in kiosks 20 %
Increase number of kiosks for other usage 25%
Others 15 % 20 % 25 %
15 %
Distribution
All the Airlines are continuing to gain more control of ticket distribution, selling via “ directly controlled channels”.
The process of Ancillary it is just starting in LATAM . The suppliers of these technologies will be the key to penetration, even
for other software. Ancillary services are primarily sold through airlines own distribution channels
Infrastructure
Implementation of all virtualisation and cloud services has increased, with Infrastructure-as-a-Service as the airlines’ main
area of investment. 70 % of airlines have or plan to have Infrastructure Virtualisation/Service implemented by 2014

5. Map Segments, Market penetration
In the segment of the major airlines ( Traditional and LCC / Hybrid ) principal suppliers on core systems of passenger sales (
bookings - TKT – DCS ) are Sabre, Amadeus and Navitaire. These providers have a dominant market position in this particular
segment.
Nevertheless , there are an interesting market and opportunities on complementary suites especially Loyalty, CRM and
Business Intelligent
Traditional Major Airlines - Initial view of Core Sys, Providers and Suites
In the Core Systems ( Reservation - DCS - etc ) the airlines have suppliers in all cases, but in suites there are more
opportunities
High Medium Low
MAYOR AIRLINES IATA core sys providers suites providers
traditional Res - DCS - tkt hitit posibility web FRM mkt & Plannig FF - Loyalty Business Inteligent Revenue Acounting Consulting hitit posibility
Aerolíneas Argentinas AR Sabre sonic Sabre Sonic Web aerolineas plus no no
Aeroméxico AM Sabre sonic Sabre Sonic Web Sabre air vision on request on request Indra ARACS FX no
Avianca AV Amadeus Altea on request on request LifeMiles on request on request Indra
Copa Airlines CM on request on request OnePass on request on request on request
LAN Airlines LÁ Sabre sonic on request Indra LANPASS Indra on request on request
LAN Argentina 4M Sabre sonic on request Indra LANPASS Indra on request on request
LAN Perú LP Sabre sonic on request Indra LANPASS Indra on request on request
TACA TA Amadeus Altea on request on request LifeMiles on request on request Indra
TAM Airlines JJ Amadeus Altea on request on request TAM Fidelidade Sabre - Airvision Indra ARACS FX no
Major LC / Hybrid Airlines - Core systems providers and suites
The concern for web development in this segment is high. There are more opportunities in suites.
High Medium Low
MAYOR AIRLINES IATA core sys providers suites providers
Low Cost / Hybrid Res - DCS - tkt hitit posibility web FRM mkt & Plannig FF - Loyalty Business Inteligent Revenue Acounting Consulting hitit posibility
GOL G3 Navitaire Navitaire on request smiles on request Indra ARACS FX on request
AZUL AD Navitaire on request on request Tudo Azul on request on request on request
WEB JET WH Travel Tech.Inter Mac Media on request NO on request on request Macquiere
INTERJET 4O Navitaire on request on request CLUB INTERJET on request on request on request
VOLARIS Y4 Navitaire on request on request NO on request on request on request
TRIP LINHAS AEREAS 8R in house on request on request NO on request on request on request
VIVAAEROBUS VB EzyFlight on request on request NO on request on request on request
Medium and Small Airlines by country - Core sys and suites
The segment of medium and small airlines is where a provider have the best opportunities, not just the ability to install or
change the existing Core Sys ( Reservation – DCS etc ) but also for the suites. Most of the medians and small airlines are just
beginning the IT&T process.
High Medium Low
LATAM quantity Basic Core Sys Suites
Medium - Small airlines - Start Up of airlines percentage airlines with HITIT posibility percentage airlines HITIT posibility
( start up Core Sys installed ( Install or change ) with suites CRANES FF - 4C -OCC - SP - IMP
Country Included ) ( web included ) Crane Pax solutions installed SLOTS - CREW - RCA . POP
Argentina 8 80% 20%
Bolivia 9 85% 15%
Brasil 26 80% 30%
Colombia 15 80% 30%
Chile 10 86% 40%
Ecuador 7 75% 30%
Peru 9 75% 30%
Uruguay 4 50% 40%
Venezuela 15 76% 35%
Mexico 30 90% 50%
others 38 85% 30%

6. Potential market penetration – Core Sys
( preliminary )
Global market by airlines ( total )
There are 171 airlines in Latam between large, LCC and medium
and small airlines.
In the group of major airlines and some medium (51 airlines)
potential penetration of a medium provider in Core Sys is almost
nil ( because of the difficulties posed by migration to other
systems and commercial ties initiated in a while between
suppliers and airlines ).
But there is large segment of medium-sized and small airlines
that has a patchwork of software (not integrated) in which are
noted with strong ability to penetrate with Core Sys and with
specific software solutions integrated ( ie CRANE Pax and FF
Loyalty - Intelligent and web solutions )
Major Airlines by pax – Core Sys
The 10 most important or major traditional airlines ( full services
) in LATAM carry about 130 million passengers per year .
Of this total a medium providers like Hitit ( ie Crane Pax ) has
opportunities to reach 20 million ( pax / PNRs ) and possibility of
another 10 million ( pax / PNRs ) per year, in this particular
segment.
The task will not be quick or simple, but there are opportunities
especially in secondary or feeder airlines under the control of
major airlines.
Major LCC/Hybrid by pax – Core Sys
In the market segment of the largest LCC / Hybrid ( 7 airlines in
LATAM region including Mexico ) possibilities like Crane Pax by
Hitit are more interesting than the traditional segment.
From a total estimated 14 million passengers / PNRs of the larget
LCC, a medium provider ( ie HITIT ) could access 5 million
passengers / PNRs. depending marketing strategy and price
policy.
The advantages of technology integrated ( ie CRANE Pax and
others solutions of HITIT ) will be the key.
In the latest survey conducted by Sabre ( January 2012 ) to decision makers and influencers in the field of Information
Technology (IT) in 77 of the top 200 carriers of various business models and operations, including global networks, low-cost
carriers, regional and domestic , had these results. Reflect the views of officers, directors, managers and analysts in the airline
industry.

7. They also represent a sound basis for Sabre Airlines Solutions, to understand the challenges specific to the industry, and
develop appropriate solutions to meet these requirements.
Sabre Airline Solutions provides technology solutions for the international aviation industry. Offers Software's business as
largest service industry with its innovative reservation system, business planning and operations software used by over 300
airlines and 100 airports worldwide.
Each year more than 450 million passengers board planes through the technology of Sabre. Sabre Airline Solutions is part of
Sabre Holdings, a global technology company dedicated to the travel industry and tourism, the most widespread in the world.