How Web Services Can Help Create a New Revenue Stream from Existing Intellectual Property


Sabre is the worldwide leader in providing information technology solutions for the travel and transportation industry. The company is best known for its innovative travel and reservation systems, used by travel agents and corporate travel departments for almost thirty years as a means to handle flight reservations and hotel room bookings and to provide numerous other travel-related services. But the company is also known within the industry for providing travel-related consulting and software development and for the outsourcing reservation systems for its customer base.

As a leading-edge exploiter of technology, Sabre constantly looks for new technologies that it can use to help broaden its customer base or service its customers better. As part of its strategic due diligence, the company has closely watched the evolution of UDDI, WSDL, and SOAP and believes that these standards can be highly instrumental in helping the company open new sources of revenue while helping its customers improve operational efficiency.

In this example Sabre makes use of an existing software program the "Hotel Shopper" to expand into new low-end markets using Web services. In so doing, Sabre is able to increase its revenue stream by taking existing intellectual material and reaugmenting it to serve new customers.

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Sabre Incorporated Using Existing Intellectual Property to Create a New Revenue Stream

Travel agencies spend thousands to hundreds of thousands of dollars annually using people-time to manually make phone calls or visit Web sites to look up hotel availability, accommodations, and costs. In its application portfolio Sabre has a hotel location/booking application (called the "Hotel Shopper"). This application enables Sabre's business partners to search for hotel rooms by geography (for instance, helping to find all the hotels in the area of Hollywood and Vine streets or near the Eiffel Tower). It also automatically indicates if the hotels being evaluated have available space and helps determine the type of accommodations and prices for rooms.

Many of Sabre's larger customers have highly skilled programmers who have been able to write specialized programs that interface with Sabre's Passenger Services System to gain access to the Hotel Shopper program. (These specialized programs access Sabre's system using complex "command-level" programs.) A description of the ins-and-outs of writing "command-level" interfaces is not important what matters is that writing such interfaces between a client system and a Sabre system requires sophisticated and costly skills (generally not in the range of technical competence or cost for most small businesses and even some mid-sized businesses).

The use of Web services protocols provides a means for Sabre's small- and mid-sized business partners to easily interface with Sabre's Hotel Shopper application. Instead of having to write complex command-level interfaces to access Sabre's Passenger Services System that houses its Hotel Shopper application, Sabre's small- and mid-sized business partners can use much simpler WSDL and SOAP protocols to get access to Hotel Shopper.

This example illustrates how Sabre was able to leverage an existing application (the Hotel Shopper) to better serve its existing customers as well as open new opportunities to market its services to new customers. By making it extremely easy for all kinds of small-, medium-, and large sized business customers to interface with its Hotel Shopper system, the company has opened-up new revenue opportunities for itself using existing intellectual material.

Now, take this situation and extrapolate a bit. Suppose Sabre were to decide that the Hotel Shopper application was not a "strategic" application. (At present, this is not the case, but we're just supposing.) Should Sabre make this application available industrywide as a Web service, the company could open up a new source of revenue by charging a fee (a micropayment) every time any travel agency made use of it. If this application were to be heavily used by travel agents industrywide, Sabre could make a lot of money (thus creating a new revenue source for the company). Further, if the company were to make dozens of other applications available as Web services, the company could stand to make even more money. In this "pretend" example, notice how Sabre's business model would be shifted by the use of a Web services approach to offering its products to market on an open/micropayment basis to the mass travel agency marketplace.

Not So Fast…

By making use of Web service protocols Sabre has been able to extend an already existing application (the Hotel Shopper) to its existing business partners and to prospective new customers. To do this Sabre has used simple-to-implement WSDL and SOAP Web services protocols. Note, though, that the company has not yet listed these services in a public UDDI registry hence the location of this newly Web-enabled service is not generally known to the travel industry.

At the time of this writing it was unclear what Sabre's ultimate plans were for using UDDI directories. The company could create a private UDDI directory service for its clients such that they could gain access to a suite of Web-enabled applications. Or the company could ultimately make all or part of its application portfolio available to the travel agency market in the form of Web services. Or the company could choose to do neither.



Web Services Explained. Solutions and Applications for the Real World
Web Services Explained, Solutions and Applications for the Real World
ISBN: 0130479632
EAN: 2147483647
Year: 2002
Pages: 115
Authors: Joe Clabby

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