On the airline and hotel side, the programs originally thrived on information arbitrage. Long ago, if I was on a plane of 100 people, I might be the only one collecting the miles and thinking of using them for a long-haul F award. 50 people didn't know the miles existed, 25 knew they existed but didn't know how to use them, and 24 redeemed the miles for coach tickets to Orlando. The other 99 people were paying for the program, but I was the only one really using it well. (OK, extreme example, but you get the point.)

I also remember checking into a Marriott with minimal if any status, getting a suite upgrade, and being told I was the only Marriott Marquis member in the hotel that night.

Today, everybody is aware of the programs. More people pay attention to their points and miles. There is still some breakage, but now even relative travel novices know the game is to milk a few credit cards and then go for the F/J awards on partner airlines. The Internet has completely covered this.

In the end, I don't think the programs will die. I just think more and more programs will morph to Southwest-style rebate programs. (Many are already there on the earning side.) The aspirational award - the true F experience on the world's best carriers - will become ever more elusive. In the hotel space, Hilton is already going this way. The death of Starwood as a high-experience aspirational program will eventually fast-track the whole industry this way.