Parents and kids squabble all the time, especially when said kids become teens. But it's a different matter when corporate kids take on their former owners. Privately held Sabre Holdings is in that sort of spat with AMR Corp.
Sabre and AMR, otherwise known as the holding company for American Airlines, are fighting over fees. American wants to sell more seats directly to customers and thereby reduce payments to Sabre and its ticket-distributing peers.
Like Orbitz Worldwide
Why should you care? Sabre is the world's largest ticketing system. Created by American in the 1960s to improve reservations management, Sabre today serves more than 57,000 travel agencies as a clearinghouse for booking flights, hotels, and even cruises. Sabre owns online travel agency Travelocity and serves several of its competitors, including Expedia and American Express'
With a footprint that big, Sabre's downplaying of American fares could make it much harder for the airline to capture travelers who aren't locked into a frequent flier relationship. Travelers who are searching for nothing more than the best route or fare.
Spat spiraling out of control
The fight's now in the courts, and this week a judge ordered Sabre to give American equal treatment in its system. But the injunction is temporary, and Sabre shows no signs of backing off its stance.
"Sabre is confident that our actions are well within our contractual rights, and we will aggressively defend against American Airlines' baseless claims to the contrary," a Sabre spokeswoman told The Wall Street Journal.
Investors need to watch this brawl. If American wins, it'll be yet another blow to online travel agencies, whose ability to generate fees is already under assault by fare search services supplied by the likes of Google
On the other hand, if Sabre wins, it'll once more reveal how dependent on outside forces legacy carriers have become. Either way, there's a lot at stake for American and its big airline peers.
Now it's your turn to weigh in. Would you bet on the carriers or the OTAs in this fight? Use the comments section below to explain your thinking. You can also rate AMR Corp. in Motley Fool CAPS.
What will be the big trends of the next five years? We asked our top equity analysts that question and they came back with five stocks we've put real money behind. We profile all five picks in a new special report. Get instant access by clicking here -- it's free.