New Distribution Capability (NDC) is a technical standard through which an airline builds its own offer, such as a seat with a meal and a bag at one price, and sends it straight to travel sites and agents. IATA, the global association of airlines, created the standard. NDC sets the format of the messages that an airline's software and a travel site's software send each other. In practice, it is an API: the travel site sends a search request, and the airline's system sends back priced offers.
Before NDC, airlines filed their fares with the global distribution systems (GDS) in advance. The GDS showed the same fares to every agent. Extras, such as a seat with more legroom or a meal, were hard to sell through agents. They were often sold only on the airline's own website.
With NDC, the airline's own software answers each search. It can build a different offer for each request and price it at that moment. This is a form of dynamic pricing. The seats themselves are still held in the airline's passenger service system (PSS). The offer is built on top of them.
Imagine a lawyer in Chennai who searches a travel app for a flight to Delhi. The app sends an NDC request to the airline. Within a second, the airline returns three offers. The first is a basic fare of ₹6,400 with cabin baggage only. The second is ₹7,450, with a 15 kg checked bag and a free choice of seat. The third is ₹7,850. It adds a meal and seat 3C, which has extra legroom. The lawyer chooses the third offer. The app sends an order back to the airline, and the airline confirms it. The order is one record of everything she bought and paid for.
Travel sites receive these offers in three ways. Some, such as an online travel agency or a B2B travel portal, connect to each airline directly. Others receive NDC offers through a GDS, which now carries them beside its own fares. Large companies receive them through a corporate travel platform.
NDC has costs. Each travel site must build and maintain a separate connection to each airline. Airlines use the standard in slightly different ways. And the same flight can show different prices on two sites, which confuses travellers.
The next step is called offers and orders. Today a booking is stored as a PNR, with a separate ticket number and separate records for extras such as a bag. Under offers and orders, each trip would have one order record holding all of them.