Sabre CIO on the impact of cloud in travel

Aviation companies and the travel industry more widely have accepted that cloud technologies will play a huge role in their businesses going forward.

In recent months, Boeing and American Airlines have talked about their cloud developments with Google and Microsoft while technology players in travel including Mews and Spotnana have highlighted their cloud developments.

Global distribution giants Amadeus , Sabre and Travelport have also stressed the importance of the cloud in terms of bringing costs down, driving efficiency and enabling more rapid development and deployment of products and services.

Sabre said in an earnings call last year that its technology milestones for 2022 were to "exit our Sabre-managed data centers and migrate to the Google Cloud" as well as to bring the customer reservations database to Google Cloud.

Joe DiFonzo, chief information officer at Sabre has lived and breathed large scale technology transformation and system evolution for the past 25 years, predominantly in the telecommunications sector.

He talks to PhocusWire about where Sabre and the wider industry is in its cloud journey, the benefits of the technology and the next steps. His comments have been edited for brevity.

On the journey…

After 25 years in telecoms with responsibility for evolving systems and platforms from mainframe to open systems and then cloud computing, it’s funny to see that coming into Sabre, there are a lot of the same characteristics.

It was obvious right away that there were issues to deal with in terms of scale and performance and economics. Our cost of operations was high compared to what I’ve seen in other places. Also, our ability to evolve the business quickly was lagging. We were still very old school in the way we were developing, operating and deploying our software and it was making us slower than customers needed.

We started on the path in late 2017 with a big program to bring all our systems to the cloud and evolve our mode of operation... and we are well on that journey now. By late 2019, after the efforts of two years, we did a cost benefit analysis of the multi-cloud vendor approach and decided that, if we could find the right partner, there would be more benefit in focusing on a single provider.

One of the things overlooked when go down the multi-cloud vendor path is there is that when you get into what they call their platform services - databases, messaging protocols, encryption technology, security and things like AI and Big Data - it gets very unique. But, that’s really where the secret sauce is, that’s where we’re going to get a lot of value.

Google was the one most aligned with our way of thinking - it’s very engineering focused and very B2B focused. We also saw that its big data and machine learning capabilities would be really strategic for our business specifically.

On maintaining investment in the pandemic…

This where I’ll give a lot of credit to our senior leadership team, our board and specifically, our CEO Sean Menke. He dug in and said this is the most important thing the company is doing, and we’re going to suffer going through this pandemic as a lot of businesses in the travel space are but we’re not going to let up on the technology transformation effort. And, I can attest to that, we did not let up. As a matter of fact, we doubled down and worked harder than ever and found more resources than ever through that effort in 2020, 2021 and into 2022 to make the progress we had promised.

On hitting targets…

At the end of 2022 we closed every Sabre-operated data center on the planet. There were a total of 14 when we started. By the end of 2023, we will close out operations in the DXC data center in Tulsa, including one which has been operating since 1972. At the end of 2023, we will still have a couple of mainframes running, one for primary service and one for disaster recovery, but the workload on them will be much lower.

By the end of this year, we will have completed the development effort to get at least all of the GDS functionality off mainframe and into the cloud. In addition, a lot of passenger service system capabilities will be in the cloud, such as ticketing and check-in services. Another big element we’re working on is the passenger name record (PNR). We’re in the process of offloading all of the PNRs into the cloud so over time the footprint of what’s on the mainframe is shrinking.

On reaping the benefits…

We’re starting to see the financial benefits of what’s going on. We’re seeing our hosting cost reductions as anticipated but the bigger thing is we’re starting to see real efficiency gains in day-to-day operations and our software development efforts. One of the things that has happened is that development teams have a lot more autonomy in what they do every day. We have techniques we can employ now because of the cloud that provide a lot more stability and security than we have ever had in our environment before.

In the old days every time something needed to be deployed or new products launched, we would have to buy hardware, install it, configure it and network it. Every change would have to be manually performed. It was not only time consuming but operationally risky because there were a lot of places where you could make a mistake.

Moving to the cloud, there is this notion of infrastructure as code so instead of developers saying they need X and Y, they essentially program it in a language called Terraform and deploy it through an automated deployment pipeline. They can do it in minutes and because of the cloud capability to dynamically create infrastructure we can do blue-green deployments where we have the existing system running and materialize a new copy of the system, make sure it’s running property, cut the customer connections over to that and delete the old copy.

Changes that used to take days and weeks happen in minutes and hours.

On boosting capabilities…

We have all these capabilities we didn’t have before such as new database and communications technology. But, probably the biggest game-changer is a technology called Vertex AI, which is Google’s AI/machine learning platform.

You’ve probably heard us talk about Sabre’s travel AI capabilities . They are a series of individual microservices with each one very focused on a specific task, e.g. optimizing ancillary offers or hotel recommendations for agencies. We basically built those things using a combination of cloud infrastructure and ML models and the ML training infrastructure. So, we can turn these things around very quickly and use all the data Sabre has collected and get these capabilities to market very quickly. We’re now getting customers in and whipping up a real working prototype, with real data that is close to production, ready for them to try.

On the the next steps…

We are already rolling out things like Travel AI and Intelligent Retailing. With the capabilities, and with Google, we’re cycling faster and faster and seeing that flywheel effect in terms of how quickly we can roll out these products.

Now we get to the next level from a technical perspective in terms of how our developers develop and deliver software. It’s not only about getting these new products to market but also delivering new features and functionality for existing products more quickly and safely than ever before. Saving money is good but the bigger thing is generating new revenue and being an efficient and effective software developer.

On business continuity during transformation…

It’s a huge challenge. We have clear guidelines on what we’re allowed and not allowed to do to ensure customers are not impacted and, if they are, that it’s minimal impact.

All of these migrations have been in a mode where we have a version of the system in the cloud and a version in the non-cloud. We have a very involved transition process. For a long time it runs in both until eventually it’s only in the cloud. All these things are carefully timed, staged and tested all the way through because the objective to not impact customers. If possible, they’re not even aware that we’ve completed these migrations.

On the industry’s move away from PNRs…

Those PNRs are going to have to be around for a while. Even if you look at what’s going on in the industry, if you look at the predictions from IATA, you’re talking about probably 2030 before everybody has migrated to that new model. Some would say that’s a rosy prediction. So, we’re going to be dealing with legacy for a while and essentially PNRs will become a legacy thing instead of the primary thing as we move to order-based systems. But, now we have the PNRs in the cloud, it’s easier to integrate our offer-order capability because they’ll all be cloud hosted and the cloud APIs are much easier to deal with.

On the airline mindset around adopting cloud technology…

I think we’re seeing much more openness. Many of our customers were watching very closely what we were doing, what we were going through and what kind of success we were having before they were ready to jump. I would definitely say more and more companies in travel are looking at cloud because it boils down to that it’s the right way to do computing.