Its desparation plain and simple. The airlines are looking for any way to fill seats, and especially for last minute or higher business tickets.

It doesn't cost them anything, or almost nothing, only a few extra bonus miles for the elite level bonus, and maybe an upgrade that doesn't go to someone else. If the targeted person doesn't use the elite status, all they are out is a 37 cent stamp and maybe a quarter for the plastic card. As long as it doesn't become public knowledge that they are doing this it is win-win for them. And with many awash in red ink I don't think they are even thinking about making the people mad who actually earned elite status by flying. That could have something to do with why they are losing some of that money.

I don't fly on one airline only, as where I live there is no real dominant carrier. I do prefer one over another, and look more at the total flight time than the airline. Status in the airline program does enter into the equasion of which flight I book, as obviously I would prefer to upgrade, but because of fares or bad connect times or wanting to arrive at a location at a better time - say to avoid traffic, or avoid a RJ, or to arrive early so I don't have to fly in the night before carry weight. A better connection at a hub can beat an upgrade, but in some airports using the elite line is worth flying one airline over another. So I wind up being mid-level in four airlines rather than being top tier in one and mid in another.

I did take a comp on Alaska when they were after United's elite at the beginning of the year. I flew them as I had a trip where my choices were them or an airline I didn't have status. So the comp did bring them some extra revenue, and cost them nothing, so it was more cost effective than any other form of advertising.