Originally Posted by pinniped

I'm still convinced that airlines have already run simulations/models if not enough live implementations of this to confirm whether or not it works in their markets.

Many European carriers do exactly what we're talking about...that's effectively what the short-haul business class product is. (The middle seat folds down into a small table.)

But they've realized that for long-haul the market audience that would pay a big premium for an empty middle is the same target audience that they want buying their existing business class seats.

They probably look at it as a cannibalization problem: firms that currently permit their employees to travel in premium cabins would be tempted to fly the new product, pitching it internally as "cost effective but not too awful". But few firms that have always required coach travel (e.g., the majority of firms) would add this to their travel policy, thus raising their travel costs by 50% or whatever.

I think airlines are more inclined to find ways to pamper and nurture the few firms left that still fly their employees in C/J, not tempt them to move back into Y.

The company policy from the OP is a rarity.