Originally Posted by dhuey

Indeed, price discrimination is what airline revenue is all about. The costs of this product are almost entirely fixed as to a given seat on an airplane. Whether it's fares, miles or a combo of both, this is all about getting the most money possible from each customer. Sell cheap to the bargain-hunters (elastic demand); stick it to the gotta-get-there-exactly-then customers (inelastic). There are many shades of grey between the extremes, and mileage programs help add more colors to the price-discriminating palate.