Originally Posted by eponymous_coward

The money that an airline gets from a cobrand card issuer or others that buy miles is almost pure profit compared to the expense of flying an airplane and collecting fares. The airline is trying to incentivize profitable behavior by encouraging people to acquire miles and then burn them. Elite benefits awarded for things like award flights or credit card spend make the program "sticky" because then the airline has more to offer as an incentive to keep spending on the card and redeeming for flights- status benefits (that are rapidly being watered down by selling F cash upgrades, taking a free bag or RDM earning away from lower level elites, and so on).

A lot of AS award inventory is not priced much better than DL SkyPesos (in fact some of it is considerably worse, a penny of cash value per mile for an AS award is not at all uncommon). Again, here in the FT bubble where we all redeem for JX J, JL F etc. is way different than outside where people do things like redeem flying F to Hawaii at 95k miles per person one way (or Vegas at 50k a head, or whatever) as an aspirational vacation.

Also, if said someone is just using other airlines for award travel and not AS, the cost is AS writing a check to OAL for the award redemptions (and again, for the vast majority of AS customers, AS redemptions are for AS flights, many of which are at unfavorable redemption rates). AS has pretty good beancounters; they are already doing a number of things that make the overall system closer to revenue based (Saver fares, forcing partner bookings through alaskaair.com to get maximum RDM/EQM earning). I don't see why they couldn't go all the way if they thought it was to their benefit. I think earning elite status for award travel does indeed fit in with tethering AS closer to revenue-based earn and burn.