I don't believe this is an accurate statement, CM's and AM's cost the same to distribute, the difference in margins comes from how much revenue the program gets for each type of mile. In the example in the graphic posted the program (note the careful distinction here between program and airline, because in effect the program is a separate business the airline is paying for the miles) gets $.006 per mile for AM's and $.015 per mile for CM's. I believe the program earns little to no margin on AM's while the difference in cost between an AM and CM is almost entirely margin.