If this is true, it seems to me that there are a lot of problems with it from the perspective of the airline.
First, it creates a situation where you'll have people willing to pay the $100, yet the CRS will show the flight as full, so they won't be able to sell the $100 confirmed standby seat. If confirmed passengers then don't show up for the flight, it goes out with empty seats.
Or, conversely, it means that since you can't pay the $100 and confirm unless a seat is available in inventory, you'll have to wait at the gate until the 10 minute mark to see if, when they cancel out the no-shows, a seat becomes available in inventory, at which time chaos will ensue as they try to collect the $100 to confirm everyone that wants on the flight. And after that, they've still got to deal with non-rev standbys. That's compressing a lot of activity into the last 10-20 minutes before a flight, which will result in delays.
A similar problem results when they clear Medallions for first class upgrades. At that point, those passengers' Y seats are vacated and return to inventory, which means that then the airline can sell more confirmed standby seats for $100 each, putting a crush on the gate agents to collect this money and get those people on the plane -- all during the last 10 minutes before flight departure. And you know they'll want to capture these $100 fees, so they'll do it. And how will they prioritize those in the gate area waiting to see if any Y inventory becomes available so that they can purchase the $100 confirmed standby? I can just see two seats becoming available and ten people rushing the podium with $100 in hand. I guess they'll have to create a standby list for the confirmed standby list to make this orderly.
My thinking as to the reason behind this new policy is that somebody finally figured out that it was going to irk people to pay a nonrefundable $100 standby fee if they didn't clear the standby list. Ergo, they decided to confirm the standby when the $100 exchanges hands so that nobody paying the $100 fails to clear.
And, thinking this through more, if inventory does not have to be available in the specific class in which you were originally booked, but instead only has to be available in the cabin in which you were booked (i.e., you were booked in L, but all that's available is Y, so you pay the $100 and take one of the Y seats), does that mean that upon paying the $100 and taking one of the Y seats, you can then use a Medallion upgrade certificate (i.e., have you transitioned from a non-upgradeable to an upgradeable fare when you pay $100 and take the Y seat)?
Can't you just see that? You buy a U fare, then you spy a flight two hours earlier that's sold out in U, L, and T; you call, pay the $100 and claim one of the Y/B/M/H/Q/K seats, then turn around and upgrade it. In effect, you've upgraded on a U fare for an extra $100. Not a bad deal if we're talking a transcontinental flight where the U fare was $198 roundtrip.
Just a lot of things that could happen with this developing policy . . .
[This message has been edited by Robert Leach (edited 10-10-2002).]