The only thing this accomplishes is that there will be fewer elites. It will not increase revenue. I doubt that any significant number of elites book on sites like travelocity. Elites who don't book on the UA website are simply required by corporate policy to book via their corporate travel agent.

And that's kind of the problem with the whole revenue model. I suspect that a very significant percentage of loyal flyers are corporate flyers, and they are obligated to purchase the lowest-cost tickets no matter what.

I have no problem with UA wanting to pamper those who purchase expensive tickets. But if UA cares about loyalty, it needs to continue to reward loyalty in some reasonable way.