Airlines at risk from aging technology
Old computer systems, layered together over years, need complete overhaul, experts say
The technical glitches that have plagued airlines like Delta, which was forced to cancel and delay thousands of flights this week, are unlikely to end any time soon. The industry is grappling with an aging, increasingly complex web of computer systems responsible for tasks ranging from selling tickets to scheduling flight crews.
Where once software was used primarily to book flights and is- sue tickets, today it’s now a matrix of overlapping, often disjointed systems that interact with mobile apps, track loyalty awards and help the airline industry bring in billions of dollars through the sale of perks like extra leg room. That growing complexity makes for hiccups, and they are difficult to avoid.
Some of the systems, like Delta’s, are built on top of systems that are decades old. For instance, Delta’s reservation and passenger service system is multilayered, built on a 52-year-old program called Deltamatic.
“It’s a ‘Mad Men’-era computer system,” says Henry Harteveldt, an analyst with the travel industry company Atmosphere Research Group.
By Wednesday, Delta had been forced to ground or delay well over 4,000 flights, the biggest disruption to the airline’s operations since the terror attacks of Sept. 11, 2001. The fact that Delta, known for its on-time reliability, took days to get back on track illustrates the intricacy at play when so many systems have to work together.
“They genuinely are a very reliable carrier and this is a tremendous aberration which came as a surprise to everybody,’’ says Daniel Baker, CEO of flight tracking site Flight-Aware. “I think it’s a combination of an extremely in- terconnected and complex system. And bad luck.’’
Delta’s technical meltdown was just the most recent to leave passengers in the lurch.
Don’t expect reliability to improve anytime soon.
“This is not the end to these sorts of problems,’’ says Baker . “It’s not like the airline can say ‘we’ll invest in this and by Christmas we’ll guarantee reliability. These are multi-year endeavors. .... (And) in general, the airlines are like a wristwatch. Every little piece has to work perfectly or it all falls apart.’’
In a videotaped message Aug. 9, Delta’s CEO Ed Bastian apologized for this week’s disruption
and said that “over the last three years, we’ve invested hundreds of millions of dollars in technology, infrastructure upgrades and systems including backup systems to prevent what happened yesterday from occurring.”
However, Bastian has since said that roughly 300 of Delta’s 7,000 servers were not linked to an alternate power source. When a faulty piece of power control equipment caught fire on Monday, sparking a surge that knocked out power, servers that did have backup were unable to communicate with those that did not, taking down Delta’s whole system.
“Our infrastructure is dated, no question,” Bastian told The Atlanta Journal Constitution newspaper, but “I don’t think that was the problem.”
Still, before this week’s incident, Delta had already brought on board a new executive to oversee its technology and help outline next steps.
The airline declined an interview request with Bastian.
While the basic foundation of many airline systems has been in use for decades, complexity, not age, is the real problem, says Lance Sherry, director of the Center for Air Transportation Systems Research at George Mason University.
“So many systems are layered on top of each other that we don’t always know who’s talking to whom,” said Sherry.
Sherry says that every airline runs multiple, intersecting software systems which must flawlessly interact for the entire system to function. There are at least six: ticketing reservation, aircraft assignment, flight crew scheduling, airport gate assignment, air traffic flow management and irregular operations systems.
Often they come from different vendors and use different software languages. And yet they must be synchronized, and timing is split-second and critical.
“It’s like a ballet, where the ballerina is thrown up by one dancer but another one has to catch her coming down,” Sherry says.
The three main players in the business, Sabre, Amadeus and Hewlett Packard, are all working on integrated systems, he says, but that process takes time and can be delayed by factors as routine as airline purchase cycles or as fundamental as a carrier’s financial health.
A systems upgrade would likely cost an airline at least $75 million, according to Harteveldt. But airlines have been flush with profits in recent years, thanks to plunging fuel costs and a disciplined matching of seats to passenger demand. Last year was the industry’s biggest moneymaker at least since deregulation in 1978, with airlines reporting $25 billion in profits — monies that they poured, in part, into stock buybacks and dividends for investors.
Although share prices have lagged year to date, with the S&P airline index down 18.3% through Aug. 5, vs. a 6.8% increase for the S&P 500, the industry index outperformed the S&P 500 on a five-year compound annual growth base, increasing 26% as compared with 12.4%, according to Jim Corridore, an analyst with S&P Global Market Intelligence.
While money may not currently be a major roadblock, another obstacle to system upgrades remains — the fact that those platforms run 24 hours a day, seven days a week, 365 days a year. A company can’t just stop operations for four days while it installs a new system. It would simply lose too much money and too many passengers. Additionally, global regulatory requirements make full-scale overhaul difficult.
“So many systems are layered on top of each other that we don’t always know who’s talking to whom.” Lance Sherry, director of the Center for Air Transportation Systems Research at George Mason University