zombietooth

That was a truly silly statement--the airlines want as many elites as possible!!!
I should think that the best way for an airline to prosper is to increase the pool of loyal fliers, not decrease them! They do this best by giving powerful incentives to achieve status and this, in turn, results in behavior by the traveler that is not in the traveler's best interests, from a financial or time-cost perspective, but is mainly of benefit to the airline. That is why 1K fliers like myself will choose a routing through a UA hub over a cheaper, more direct flight. I follow this pattern and I would bet that most 1Ks do also. Almost every trip that I take results in higher cost and more transit time because of my loyalty to UA. Only rarely does UA have the cheapest fare but, it doesn't matter to me anyway because I want status.

By disincentivizing segment fliers, I believe that UACO will be hurting itself because it will inspire more cost-effective behavior by previously loyal fliers, resulting in decreased loads on short-haul domestic flights (unless, of course, UACO becomes more competitive from a price perspective).

I understand the selfish motivation, of those of us who will achieve 1K status no matter what, to have less competition for upgrade seats, but it is ridiculous to believe that the airlines care about our upgrade chances. Their ideal scenario is to sell-out the higher upgradeable fares to elites who play the upgrade lottery, and then sell-out the premium cabins to full/partial-revenue passengers, leaving us with unused SWUs that expire worthless! Oh, and I am sorry, but domestic upgrades just aren't that valuable unless you are on a PS flight--I think the exit rows are more comfortable than the crappy UA FC domestic product, and would always opt for the exit row over FC except my wife likes the FC cabin.

I respect you segment fliers and hope that things will work-out for you in a more favorable way.