Competition, Antitrust Rules Serve Consumers, Adkinson Says
WASHINGTON, D.C. - At an official Department of Transportation hearing on proposed federal regulation of the air travel ticket distribution system – the Computer Reservation System (CRS) – Progress & Freedom Foundation Senior Policy Counsel William F. Adkinson, Jr. spoke in favor of ending federal regulation of the competitive and consumer-friendly marketplace for air travel.
“Relying on competitive forces in the CRS service market, backed up by antitrust law and related safeguards, will best serve consumers and the entire air travel industry. Market forces are fully sufficient to discipline CRS conduct,” Adkinson told Department officials on Thursday. “Moreover, continued regulation will impose an unacceptable drag on innovation in this highly dynamic marketplace, and place artificial barriers on competition between traditional and new distribution channels.”
Adkinson urged the agency to deregulate immediately, and not to succumb to the suggestion that regulations should be imposed temporarily. “The Department should act now to deregulate the CRS industry,” he said in an official statement to the DOT. “Imposing the current proposal on a ‘temporary’ or ‘interim’ basis will almost surely result in perpetuating the current structure indefinitely. DOT should take definitive action in this proceeding to fully deregulate CRSs.”
In earlier written comments filed in DOT’s rulemaking proceeding to modify CRS regulations, Adkinson said the agency "underestimates the strength of disciplining forces in the market." He cited "the bargaining strength of airlines, the rivalry among CRSs for travel agents, and the competition among travel agents to serve air travelers," emphasizing "emerging developments such as the rise of Internet distribution and reduced airline control of CRSs." He said the DOT-adopted regime “poses a multitude of regulatory risks, including becoming obsolete due to marketplace developments, imposing unintended consequences, and skewing competition between regulated and unregulated sectors.”
The Progress & Freedom Foundation is a market-oriented think tank that studies the impact of the digital revolution and its implications for public policy. It is a 501(c)(3) nonprofit organization founded in 1993.