I would disagree - in my view, this deal is huge.
1. CAL fully understands that its adoption might drive a cascading effect of other airlines adopting the product for the competitive reason - more money to JBLU
2. The once highly touted amenities, unique to JBLU, are being sold by JBLU to its competitor, with the risk of sunk cost and unpredictable cash flow
Basically, it is the diminution of product differentiation. CO decided not to do whatever to kill JBLU, while JBLU ate the pride of the only "humanity" carrier in air travel. It is the shift of paradigm at JBLU, and a new approach to competing at CO.
The immediate effect, I believe, is the higher fares in JBLU's markets that overlap with CO's, especially FL. Down the road, I do not know yet. Time will tell, but it will not be a long wait.
Not co-inccident is that Barger is an ex-CO guy and has a great understanding of how a legacy with a NY hub makes money.
Originally Posted by
TWA Fan 1
As far as the deal between LiveTV and CO, B6 is essentially bearing the full burden of the risk since they are installing and maintaining the systems at no cost to CO. If people buy, it will be a good deal for JBLU, but if they don't, the only cost CAL has to shoulder is the slightly higher cost of fuel due to heavier payload.
Not much of a partnership if you ask me.