Ken,
The answer to your question is "it's kind of like that"
It isn't automatic, an agency would have to look at which sailings they want to get group space for, then set up the group through the cruise line's Group Sales Department. The have to commit to the minimum of 8 cabins (16 passengers).
With Carnival and RCCL, you have 30 days to get reservations for those berths or they will recall the space automatically. Celebrity is 90 days, while Princess and Holland are longer. With all lines, the typical recall of all unsold group space happens about 90 prior to departure, which is why if you are planning a cruise you don't want to do it in the last 90 days unless you want to pay the "rack" rate.
My agency belongs to consortiums and other networking organizations, so if I have group space that hasn't been booked (no deposit), then other agencies can book into my group space and earn commissions just as if they booked it directly with the cruise lines directly. This works out for me, since I don't build a reputation with the cruise line of reserving group space that I never sell - under those circumstances, the cruise line could refuse to grant me group space and rates without some payment.
One option which can be used by the agencies to hold onto group space is to pay a $25 per berth deposit so the space doesn't get recalled until the "Final Payment" date. This can get costly for small agencies, because they don't have that kind of capital to use. The online agencies don't have this problem since they have a bigger web presence and steady flow of customers.
I don't go out-of-pocket, unless it's for a theme cruise, or a special event such as the 2010 Monkeyhead Cruise on the Dream. In that case I have 50 cabins reserved, so to avoid losing my group space I committed $2500 to hold the space until it's all booked up. Of course, I won't keep the space until November 2009 if the Monkeyheads don't book it. I'll probably only give them until January to make a booking before I promote it to the general public or allow my network partners to sell into it.
DS - 