Originally Posted by VFRonTop

There is nothing I can add to the (justifiable, in my view) reaction of BAEC members to this change. However might I give a revenue proposition perspective?

This decision was all about addressing lost revenue not lost profit. The financials of HBO are sound, you can be sure that they are a sustainable product. This decision will not cut costs, as other have already mentioned, what it will do is realise additional revenue.

Once a B/S/GCH has booked their flight there is very little further revenue that can be extracted from them. However HBO fares were implemented to make BA more competitive at the lower price point of LCCs. The market segment that these fares attract is very used to paying more for ancillary services including advanced seat selection. This opens up further revenue generation opportunities for BA.

However due the benefits of BAEC membership, the desirable seats that people would pay for (emergency exit, first row on domestic etc.) are already reserved by BAEC members. So by restricting access they have monetised an otherwise revenue neutral offering.

The trick that BA seem to have missed is the issue of corporate booking policies forcing employees onto HBO tickets. Many of whom will find it very difficult to get policy exceptions approved or even to expense the extra cost of seat selection. Honestly I only assume they factored this into their calculations and decided that corporate travellers will be obligated by policy suck it up and continue to fly BA with a small proportion taking their business elsewhere.

Whatever the impact to the brand value is, BA have obviously made a decision to maximise all revenue opportunities to the detriment of frequent flier benefits, so don’t be surprised to see priority boarding and lounge access removed from B/S/GCHs travelling on HBO fares in the future.