Several months ago I converted a Chase card that I had for a year or 2 to a Continental World card, to earn some miles, obviously.

Since then I've charged over $150,000 (had some business purchases to make). $150,000 in less than 2 months, I know that's not a lot for some, but it's certainly a lot in my book. Today I noticed that they hit me for the $85 annual fee. Fine, it's part of the deal, but I figured they would waive it or offset it somehow. Seems reasonable based on the spending, right? Wrong, they won't reverse the fee, they won't give any bonus miles, they won't even give a partial credit.

At this point I was frustrated enough to cancel the card, but it's been open for a while, has a decent credit limit, and I'd like to keep it open, even if I don't use it. The agent refused to convert it to a no-fee card and told me if I wanted to convert they would inquire on my credit and open a new account on my credit report. Obviously, it's possible to convert, since that's how I got the card in the first place!

So, by refusing to waive an $85 annual fee Chase has:

a) lost a customer who potentially could charge an average of $75,000 per month and
b) lost the $85 fee because I'll either cancel or convert the card to a non-fee version before paying a dime in fees for this card

Please explain the business rationale of this to me.

Update: I just tried to speak to someone else, but the low level agent who answered REFUSED to transfer me to a supervisor. She kept saying I already spoke to someone, they won't change their mind, yadda yadda. We went around and around for 10 minutes, I never raised my voice once. Finally, after telling her I had an unrelated question, she said she would transfer me, which she did, to a random voicemail box with a rather sketchy message. At this point, I'm more mad about this last experience than the annual fee.