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Old Dec 27, 11, 7:32 pm   #76
 
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Originally Posted by HIDDY View Post
No loss to BA if the Chase punters decided to go elsewhere.
Not sure BA agrees here: I think they got a considerable sum selling miles to Chase. If Chase was unable to sign up new accounts because NA customers no longer value Avios as worth getting (not saying that's the case, but that's your argument), BA would lose a huge chunk of revenue.

Perhaps you are mixing up 'no loss to several but not all members of the BA board on FT' with BA shareholders and its executive board?

tb
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Old Dec 27, 11, 7:36 pm   #77
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Originally Posted by HIDDY View Post
Yep FT has become the number one site for freeloaders I'm afraid. One look at the hotel and fare glitch threads tells the story.

No loss to BA if the Chase punters decided to go elsewhere.
Are you aware of the significance of many FF programs to many airlines' continued survival? While, I'm not sure of BA's numbers, you would do well to look at credit card companys' role during United's bankruptcy as an example of how the FF program is a revenue generator for most airlines.

If BA doesn't want that revenue stream, fine. But it shouldn't sell millions of miles to Chase to give away to cardholders, and then change the rules to make those miles less valuable after they have sold them. It's like a store selling you a 50% off coupon and then marking up prices.

At the best it's not an aboveboard business practice. IMHO, they were lucky(or shrewd/conniving depending on your perspective) to have structured it this way. If BA UK had contracted directly with the annoyed US cardholders and then pulled this bait and switch, it could very well have run afoul of UTCCR 1999 or EU regs.

But, as I said, to each his own. Considering the revenue they provide which allows for the continued survival of BA exec club, calling Chase cardholders "punters" isn't entirely productive if you want BA to survive and thrive.
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Old Dec 27, 11, 8:24 pm   #78
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Originally Posted by Ferdinand Magellan View Post
Good point, but I didn't check AA availability because I didn't realize that it might have cost fewer miles, even without using the companion certificates. My mindset was that using the companion certificates would just naturally be the best deal. Also, the fact that BA was going to change things, without telling us what, made me think that I would be better off using those companion certificates, because I had no idea whether they would be worth much if anything after Nov. 15.
That is your downfall - without doing all the fact-checking and hard calculation first before spending mucho moolas on that BA Visa.

It has never been a good deal to use the companion voucher if your destination is to Asia. Never ever.

You dug yourself into this hole, blaming BA is not very fair despite I dont like BA just as much as you do, at least in the YQ department.

However I do like BA now after the devaluation - because now it is a SUPER good short haul program. HKG-TPE, a pay ticket easily cost $400 despite such a short flight. It is 9,000 Avios plus $82.xx taxes (including the YQ). Would cost 20K AA miles intra-Asia 2, but less taxes. Still...

MIA-PLS, same 4500 and $18.xx taxes one-way. 15,000 AA miles but only $2.50 tax one-way. The saving of 11,000 Avios easily trump the much higher taxes which BA has been erroneously charging. (International facilities fee it should not charge because there is no YQ). But I guess not enough people have protested due to the low Avios needed...

How can you not like BA now, once you have discovered its new-found strength, ironically?

Suddenly I feel quite rich with hundreds of thousands Avios and their potential value when using for those really expensive but really short Intra-Asia, Intra-South America, and even domestic North America flights? Now I only wish we have a Canadian partner so we can redeem cheap YYZ to YUL flight!

Last edited by Happy; Dec 27, 11 at 8:32 pm.
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Old Dec 27, 11, 8:46 pm   #79
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Originally Posted by HIDDY View Post
Thanks to greedy Chase punters and clueless US agents although allowed most of those routings were clearly against the rules and might have helped in some way to BA changing the rules.....
Except that BA does NEED those Chase cardholders as it NEEDS to sell miles to Chase to enhance its cash flow. FF program remains the biggest profit center for virtually every single airline that has it. Imagine the BA cardholders dont want to renew their cards, or now Chase is poaching the very same customers by pushing its in-house Chase Sapphired Preferred card that allows the earned points to transfer to several airlines / hotels programs... Chase own version to answer AMEX Premium Gold / Plat cards... as evidenced by it even poached an Exec from AMEX...

BA and BAEC would be the one that suffers, without the constant cash inflow from selling miles (for nothing).

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Originally Posted by HIDDY View Post
Anyway with LAN Argentina being thrown out of AEP and LAN constantly changing schedules those multi stopover routings are going to cause their redeemers a lot of headaches over the next year........rather them than me.
That I do agree. LAN is awful in this area. It also seems its relationship with other OneWorld members is not that good. Systems dont talk to each other, liason offices do not work, schedule changes aplenty ... Though I suspect if those are stopovers, the passengers can cope. It is CONNECTIONs that would be messed up. Stopovers - all you suffer is a day short here and a day long there on your planned stay at each location. I hope such would not happen to anyone. I do believe good karma bad karma. Those who constantly wish others bad luck would eventually have tons of such upon themselves, just a matter of time, some time down the long road of travel.... just saying.
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Old Dec 27, 11, 8:57 pm   #80
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Originally Posted by BingBongBoy View Post
No Avios complaints from me either...

I managed to get in my CX redemption before the change and got the JFK-YVR-HKG-DPS-HKG-SFO in F (J on the DPS sectors) for 150k miles and 238.10 in taxes fees and charges. Also, looking for award availability to come back from the US, I can travel in F for 60k instead of it being 75k if I want to which is a saving of 15k points... I think it is great.
Imagine you have not redeemed this before the change, and you still would like to fly this route, would you still think Avios are great?

If you think the change is great, why would you redeemed the flights before the change?

Obviously one works within the program rules and find the strength, avoid the weakness at any given time.

The program in the past is never a great program due to the YQ, but if one could work in multiple stopovers, and take advantage of certain odd balls in how regions are defined (the most obvious of course is IPC), then in certain cases, it can be a great program. However in most other cases it is just a so-so program.

Fast forward to now, it is a great program for the ultra-shorthaul, single segment, last minute redemption. It truly save a ton of money in those scenario. It allows ultra flexibility when availability is not an issue. And with that 4500 to 10000 one-way cost, I feel very giddy looking at our xxx,xxx stash.
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Old Dec 27, 11, 9:31 pm   #81
 
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Originally Posted by HIDDY View Post
Yep FT has become the number one site for freeloaders I'm afraid. One look at the hotel and fare glitch threads tells the story.

No loss to BA if the Chase punters decided to go elsewhere.
What a ridiculous view. You think BA does not make money off a large majority of Chase cardholders?
You'd be wrong.
The percentage of cardholders who ticketed itineraries like the one I quoted is far lower than 0.1%.
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Old Dec 28, 11, 2:53 am   #82
 
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Now I think about it, Avios is just a crappier version of LAN's program. In my opinion, nothing beats LAN for short haul/last minute redemptions. BA's new program does some of that (mostly by penalising those who do need to connect, thus encouraging non-stop flights), but not to the same degree as LAN (especially with the 2:5 SPG transfer).
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Old Dec 28, 11, 3:48 am   #83
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Originally Posted by Happy View Post
Except that BA does NEED those Chase cardholders as it NEEDS to sell miles to Chase to enhance its cash flow. FF program remains the biggest profit center for virtually every single airline that has it. Imagine the BA cardholders dont want to renew their cards, or now Chase is poaching the very same customers by pushing its in-house Chase Sapphired Preferred card that allows the earned points to transfer to several airlines / hotels programs... Chase own version to answer AMEX Premium Gold / Plat cards... as evidenced by it even poached an Exec from AMEX...

BA and BAEC would be the one that suffers, without the constant cash inflow from selling miles (for nothing).
Do you have any proof of this?

The current BA Reports and Accounts mentions the accounting rules it uses when dealing with miles but that's it. They do not (as far as I can see) separate out the miles liability/redemption revenue from the other numbers

Quote:
Revenue recognition – Mileage programmes
The Group operates two principal loyalty programmes.
The airline’s frequent flyer programme operates through
the airline’s ‘Executive Club’ and allows frequent travellers
to accumulate ‘BA Miles’ mileage credits that entitle them
to a choice of various awards, primarily free travel. The fair
value attributed to the awarded mileage credits is deferred
as a liability and recognised as revenue on redemption of
the miles by the participants to whom the miles are issued.
In addition, ‘BA Miles’ are sold to commercial partners to
use in promotional activity. The fair value of the miles sold
is deferred and recognised as revenue on redemption of the
miles by the participants to whom the miles are issued. The
cost of the redemption of the miles is recognised when the
miles are redeemed.
The Group also operates the AIRMILES scheme, operated
by the Company’s wholly-owned subsidiary The Mileage
Company. The scheme allows companies to purchase miles
for use in their own promotional activities. Miles can be
redeemed for a range of benefits, including flights on British
Airways and other carriers. The fair value of the miles sold
is deferred and recognised as revenue on redemption of the
miles by the participants to whom the miles are issued. The
cost of providing redemption services is recognised when the
miles are redeemed.
http://media.corporate-ir.net/media_...oadVersion.pdf
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Last edited by Jimmie76; Dec 28, 11 at 3:53 am.
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Old Dec 28, 11, 4:04 am   #84
 
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Originally Posted by Jimmie76 View Post
Yes, I mentioned that I had paid thirty something pounds and 30,000 Avios for a trip to MAD in Business on IB that would have been 500+ otherwise.
Thanks its all this real life Christmas stuff which has got in the way.
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Old Dec 28, 11, 4:27 am   #85
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Thanks its all this real life Christmas stuff which has got in the way.
Oddly I hadn't remembered the Reward Flight Saver until it came up on the screen when I was considering wholly booking with Avios - very welcome it was too.
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Old Dec 28, 11, 5:15 am   #86
 
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Originally Posted by Jimmie76 View Post
Oddly I hadn't remembered the Reward Flight Saver until it came up on the screen when I was considering wholly booking with Avios - very welcome it was too.
Next years Euro trips for will be only using the RFS. I normally go for long weekends about 4 times a year. Hopefully my health wil improve to enable me to use the scheme.
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Old Dec 28, 11, 5:33 am   #87
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Next years Euro trips for will be only using the RFS. I normally go for long weekends about 4 times a year. Hopefully my health wil improve to enable me to use the scheme.
Get well soon.
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Old Dec 28, 11, 8:22 am   #88
 
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Originally Posted by Jimmie76 View Post
Do you have any proof of this?

The current BA Reports and Accounts mentions the accounting rules it uses when dealing with miles but that's it. They do not (as far as I can see) separate out the miles liability/redemption revenue from the other numbers
No airline breaks down it's income to the extent of revealing how much it makes from the sale of miles/points, however there are some clues like the advance sale deals DL did with AMEX and AA with Citi. That puts their income from credit cards alone in the 4-5% of revenue range.

Do you seriously think BA is radically different? Given AirMiles, Tesco, AMEX, Chase, and all the other partners, do you seriously think BA is significantly lower? When you consider that this is also the same range as BA's current operating income you realize how significant partner mile/points sales are to BA.

That the outstanding miles don't show up as a liability in the balance sheet is accounting trickery. I don't know how the sleight of hand words but it's true for all carriers. I suspect it's something to do with how the liability is calculated; what is the 'cost' if the loyalty scheme is using seats that would otherwise have gone empty? Maybe it's based on a bit of extra catering, plus some historic cost for miles that are exchanged with partners?

And then there's another wrinkle. Suppose BA flogs 50,000 miles to chase for, say, $300 which are redeemed for a TATL economy ticket that in turn generates another $400 in fuel surcharges. Does it cost any more to operate the aircraft with one extra passenger? I doubt you can measure it, so that extra $400 of revenue pretty much flows straight to the operating margin.

I'm sure there are other benefits to BA but hopefully you can see just how important the FF scheme is to BA; if it were "just a bit of fun" as HIDDY seems to think there would be no need for secrecy, deception or NDA's for our moderators. The FF scheme is the difference between profit and loss for BA. Its keeping some airlines from Bankruptcy.
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Old Dec 28, 11, 9:07 am   #89
 
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Get well soon.
Thanks.
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Old Dec 28, 11, 9:10 am   #90
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Originally Posted by bernardd View Post
No airline breaks down it's income to the extent of revealing how much it makes from the sale of miles/points, however there are some clues like the advance sale deals DL did with AMEX and AA with Citi. That puts their income from credit cards alone in the 4-5% of revenue range.

Do you seriously think BA is radically different? Given AirMiles, Tesco, AMEX, Chase, and all the other partners, do you seriously think BA is significantly lower? When you consider that this is also the same range as BA's current operating income you realize how significant partner mile/points sales are to BA.

That the outstanding miles don't show up as a liability in the balance sheet is accounting trickery. I don't know how the sleight of hand words but it's true for all carriers. I suspect it's something to do with how the liability is calculated; what is the 'cost' if the loyalty scheme is using seats that would otherwise have gone empty? Maybe it's based on a bit of extra catering, plus some historic cost for miles that are exchanged with partners?

And then there's another wrinkle. Suppose BA flogs 50,000 miles to chase for, say, $300 which are redeemed for a TATL economy ticket that in turn generates another $400 in fuel surcharges. Does it cost any more to operate the aircraft with one extra passenger? I doubt you can measure it, so that extra $400 of revenue pretty much flows straight to the operating margin.

I'm sure there are other benefits to BA but hopefully you can see just how important the FF scheme is to BA; if it were "just a bit of fun" as HIDDY seems to think there would be no need for secrecy, deception or NDA's for our moderators. The FF scheme is the difference between profit and loss for BA. Its keeping some airlines from Bankruptcy.
What I was curious about was whether this was life or death for BA as Happy seems to be suggesting was the case.

Quote:
Originally Posted by Happy
Except that BA does NEED those Chase cardholders as it NEEDS to sell miles to Chase to enhance its cash flow. FF program remains the biggest profit center for virtually every single airline that has it. Imagine the BA cardholders dont want to renew their cards, or now Chase is poaching the very same customers by pushing its in-house Chase Sapphired Preferred card that allows the earned points to transfer to several airlines / hotels programs... Chase own version to answer AMEX Premium Gold / Plat cards... as evidenced by it even poached an Exec from AMEX...

BA and BAEC would be the one that suffers, without the constant cash inflow from selling miles (for nothing).
I agree that there is money to be made from the sale of miles, it's just that unlike some airlines I don't suspect BA are in such dire straits that they are reliant to such a massive degree on the sale of miles. I am *happy to be proved wrong though.

*(un)
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