I believe, at least in UA's case, it will depend on - based on data they gleaned from their "Great Offer" - how many CO OnePass members switch their travel to UA and how much revenue they bring with them.

If it is mostly low-fare travellers with aggregate revenue measured under $5,000 per year (and especially on a handful of long-haul international trips), I imagine UA will consider doing the same - especially if CO's balance sheet starts to improve (even if CO has to shrink as an airline to match the lower capacity).

If it is indeed the "mix of fare" traveller pulling in better than $20,000 and mostly domestic - or paid First/Business international with lower domestic in the $50K+ range - then UA will not consider it, for they would then drive that income on to AA.

Based on UA's "bribe" of the "Sweet Spot SWUs" to all their 1Ks, I tend to think UA has seen a significant enough decline in revenue (possibly to other carriers via pax-matching "Great Offer" statements) that they felt their attempts to do what DL/CO have done - increase average fare paid per elite - has not worked. Therefore, I think UA would be even less likely to do it, unless AA also moved.

So I tend to think that for at least 2004, UA will "hold the line", offering targeted revenue enhancement schemes - UGS, bonus miles - like they have now to passengers who currently spend what UA wishes everyone would.

I tend to think AA will do the same as UA, and wait and see. They have their MQM program to recognize the higher-fare folks and grant theme elite status with less miles flown.

I would be surprised if UA does not move to the same program (and either eliminates segment-qualification, as AA has done, or keep it, offering another elite qualification avenue that AA does not).

[This message has been edited by SEA_Tigger (edited 09-21-2003).]