Airline Revenue Economics

Oliver explains: why is airline IT so clunky?

2026-03-18 · 07:30 UTC ·Oliver Ranson ·3 min read

Brief

Oliver Ranson explains airline IT as the product of accumulated operational complexity rather than simple technological neglect. He notes that a legacy airline reservation stack has to do far more than a typical e-commerce site: it must price itineraries, issue the legal ticket contract, reserve seat inventory, validate passengers at the airport, process baggage, and allocate revenue across participating carriers. Those requirements have compounded over decades with ticket changes, accessibility services, loyalty integrations, baggage exceptions, and messy travel-agent workflows, much of it built onto systems whose foundations date to the 1960s. The result is a consumer experience that feels archaic because modern web interfaces sit on top of legacy back-end infrastructure instead of being served by systems purpose-built for online retail. His explanation emphasizes path dependence and incentive structure: replacing these systems is risky and expensive, while the existing stack is still operationally adequate for airlines.

Why it matters

Oliver Ranson argues airline IT feels clunky because it still relies on legacy systems originally built around core operational tasks dating back to the 1960s, including pricing, ticket issuance, seat inventory, airport validation, bag acceptance, and interline revenue sharing.

Key details

  • Legacy carriers face much higher system complexity than low-cost airlines because they must support multi-airline revenue division, ticket changes, special-service requests such as wheelchairs and stretchers, loyalty-program logic, status-based perks, variable baggage allowances, and agent-entered booking comments.
  • The article’s first two stated reasons are that the legacy stack is both hard to replace and still 'fit for purpose,' and that airline websites are layered on top of older reservation infrastructure rather than having back-end systems designed natively for modern web commerce.
  • Ranson’s core claim is economic rather than purely technical: because the underlying systems usually perform the airline’s operational requirements 'well enough,' incumbents have weak incentives to fund expensive full-stack replacements despite poor consumer experience.
Source evidence

title: Oliver explains: why is airline IT so clunky?
author: Oliver Ranson
contenttype: article
publication: Airline Revenue Economics
published: 2026-03-18T07:30:39+00:00
sourceurl: https://revman.substack.com/p/oliver-explains-why-is-airline-it

word_count: 678

Visit your favourite legacy airline’s website and try to book a ticket. You can almost hear the cogs turning, see the steam venting and feel the machine in the airline’s back office shuddering as the atomic reactor calculates a price. In this article we are going to explore why airline IT often feels so clunky. There are four reasons. Thanks to reader Steven for the idea. Advertisement: This is the ninth in my “Oliver explains” series. I take things that are either important tools in Revenue Management’s tool kit, sound a bit odd or seem complicated. Hopefully I will be able to make them sound simple. Some readers might find these articles rather basic. If that is the case for you, then don’t worry, more mind-bending analysis will be coming soon. If you are here to learn, or would like a refresher, read on… You can read the other eight here: 1. Why is Business Class sometimes cheaper than Economy? 2. How do airline overbooking algorithms work? 3. How is airline revenue accounting data used in revenue management? 4. What is Revenue Integrity? 5. ATPCO fare categories 6. Why are some plane tickets so expensive? 7. How are plane seats created? 8. Why getting multiple quotes for flights does not work Reason one: the legacy IT stack is hard to replace & fit for purpose The first step in understanding why airline IT is not exactly consumer friendly is to know what it actually needs to do. At a basic level it must achieve all of the following: 1. Tell passengers what flights are available, how much they cost and what conditions a traveller is accepting 2. Accept payment and, once made, issue a contract between the airline and the traveller, known as the ticket 3. Hold a seat for each passenger in the cabin they have paid for 4. Validate that a person presenting themselves at the airport has a ticket 5. Accept people and their bags for flights 6. Divvy up the revenue between all the airlines involved. The process can fail at every stage. Low-cost airlines simplify their IT a great deal by eliminating any requirement to share revenue with other airlines. Unfortunately for consumers and agents using the airlines’ systems, carriers have made things much more complicated over the years. Additional functions, like changing the date and time of tickets, were in the systems from close to day one back in the 1960s. Wheelchairs and stretchers must have been added at the same time, or maybe slightly later. From a system manager’s perspective the earliest complexities made things hard enough. The “never let the customer get in the way of your operation” trope applies just as much in IT as it does in the parts of the business that directly interface with travellers at airports and on planes. All sorts of new complexities have been added on. Loyalty points and status benefits come with robots that tell different systems when points should be awarded or when seats should be selected free of charge. Sometimes different passengers have different baggage allowances and special rates, which check-in agents need to know about. Travel agents like to put in comments, which most airline managers then ignore. Examples from real life follow… Some are fair enough, possibly – think “Mr Test Test is the passenger’s actual name”. More are a bit dicey – like “Mr M is genuine VVIP – pls do needful for First Class upgrade imdt”. Others are just plain rude – “[censored for your protection]”. At the end of the day, airline IT does a complex job well enough. As a fit for purpose technology there is little chance of airlines being inspired to spend money replacing it with something else. Reason two: web resources are built on top of the legacy tech stack Airline web resources are quite different to e-commerce platforms like, say, Amazon. With Amazon the back-end tech has been built to support the website and is owned by the tech giant. With airlines it is the other way around. Read more