Source: IATA. Carriers are listed by rank in traffic.

Market Share of World Airline Traffic, 2003

Until recently, airline companies were strongly regulated by governments with protected routes and the prevention of foreign ownership. With deregulation initiated in the United States in the 1980s, a reorganization of the airline industry has occurred. The main trend involves alliances between airline companies to the point that some have almost merged. Most large airlines, and many smaller ones, have joined alliances in order to broaden their market presence commensurate with a global economy. In 1998, about 500 alliance deals existed between airline companies, Oneworld, Star Alliance and SkyTeam being the most important (17%, 24% and 21% of the market share respectively). The largest airline not part of one of the big three alliances is Japan Airlines, Southwest Airlines, and Emirates. The consequences of such deals are as follows:

• Joint booking systems. Airlines members of an alliance are able to sell seats on their respective flights. They thus increase the chance of keeping passengers within their network.
• Optimization of connections. Airlines members of an alliance are able to decrease connection times with better scheduling, faster luggage handling and sharing adjacent gates.
• Geographical specialization. Airline companies have faced difficulties expanding abroad since foreign destinations are regulated by their respective governments. Alliances enable to use existing national networks and each member airline focus on the efficiency of their regional networks. The complexities of negotiating bilateral agreements for specific air freedoms is consequently partially avoided.
• Reorganization of hubs. The interlocking of several air transport networks occurs at specific hubs which enhance connections. Small regional airline companies act as feeders for these hubs.