Korean Air Selects PROS Revenue Management; Asian Carrier Incorporates New Revenue Management Technology

Business Wire, August 15, 2001

Business Editors/Travel Writers

SEOUL, South Korea & HOUSTON--(BUSINESS WIRE)--Aug. 15, 2001

Korean Air and PROS Revenue Management (PROS) announced today that Korean Air has contracted with PROS for the latest in revenue optimization technology. PROS is the world's leader in revenue management science and software, and the pioneer and dominant provider of revenue management to the airline and energy industries.

The PROS 5, PROS Group, and the PROS NAS Revenue Management Systems will enable Korean Air to maximize revenue by forecasting, managing, and optimizing the allocation of seat inventory at different fare levels across its network of flights. Using data functions that capture historical flight information, advanced booking activity, and actual boarding statistics, the highly advanced optimizing and forecasting engines within the PROS 5 System will produce fare class allocations that maximize revenues for each of Korean Air's flights.

Further, the PROS Group System will automate the economic analysis of group booking requests and will maintain detailed records on each group. It will communicate with PROS 5 to help Korean Air's agents offer alternatives for itineraries that meet price criteria of both the airline and its passengers. In addition, the PROS Network Analysis System, the world's only network-oriented multi-class stratification system, will rationalize Korean Air's fares according to their network contribution -- an important first step towards O&D control.

Jong Hee Lee, executive vice president of passenger sales & marketing at Korean Air, states, "Korean Air is preparing for an increase in passenger traffic across our network based on the opening of the new Incheon Airport in Seoul, and as a result, we are anticipating a considerable increase in traffic flow that requires managing a complex array of different passenger demand characteristics. The PROS suite of products will serve as an instrumental tool in helping us not only manage, but also capitalize on these higher levels of traffic."

Benson Yuen, president of PROS Revenue Management's Airline Group, continues, "We are very pleased to be providing Korean Air with our state-of-the-art revenue management expertise, and we look forward to helping Korean Air hold its position as one of the leading carriers in Asia and the world. Everyone at PROS is dedicated to building a strong and successful partnership with Korean Air."

The PROS systems are in operation at over 80 airlines around the globe, including 27 Asia/Pacific carriers as well as Korean Air's SkyTeam Alliance member AeroMexico, and the systems account for significant productivity and incremental revenue gains at these airlines.

About Korean Air

Korean Air, Korea's first flagship carrier, is celebrating its 32nd year since Choong Hoon Cho, chairman of The Hanjin Group, took over what was formerly Korean National Airlines. Before privatization, the company was a small, regional airline lacking in resources such as aircraft, network capabilities, and managerial efficiency. Just seven months after The Hanjin Group took over, new flights were launched to Japan and Southeast Asia.

In 2000, Korean Air carried over 22.1 million passengers and in excess of one-million tons of cargo to their worldwide destinations -- an amazing growth of 73 times the number of passengers and 606 times the volume of cargo carried in 1969 (the first year of privatization). Korean Air's growth is remarkable -- considering that other global airlines have worked an entire half-century to become major carriers.

Through these ongoing endeavors, reflecting a business strategy with foremost priority in safety and customer satisfaction, Korean Air strives not just to increase its profitability but also to uphold the pride of the Korean people, carrying out its mission as the national flag carrier.

A founding member of the SkyTeam alliance with fellow members Delta Air Lines, Aeromexico, and Air France; Korean Air, with a fleet of 113 aircraft, is one of the world's top 20 airlines and operates almost 400 passenger flights per day to 77 cities in 29 countries on five continents. More on Korean Air's programs, routes, frequency, and partners is available at http://www.koreanair.com/.> About PROS Revenue Management

PROS Revenue Management is the world's leader in pricing and revenue optimization solutions and the pioneer and dominant provider of revenue management to the airline and energy industries. PROS provides system solutions to the airline, cargo, rail, energy, healthcare, and broadcast industries, and has delivered over 210 systems to more than 80 clients in 37 countries. PROS' clients include 15 of the top 25 carriers in the airline industry.

The PROS mission is to maximize the revenue of each client using PROS' world-leading revenue management science, systems solutions, and best practices business consulting. PROS' clients report annual incremental revenue increases of 6-8% as a result of revenue management. PROS' solutions forecast demand, optimize inventory, and provide dynamic pricing to maximize revenue.