I found myself thinking about this very question as I fell asleep last night, and remembered this post, which I had previously ignored, and when I checked it today I was hoping to find some answers.

So let me throw out some speculation with the hopes it will be chewed up and dissected by those who really know what they're talking about.

1) Loyalty programs have evolved into marketing programs. They are designed to get you to fly, stay, rent, etc., not to keep you loyal (no matter what they say their purpose is). That is why the credit cards, long distance, and cross industry partnerships have flourished.

2) I know that at least with Hilton HHonors, cash is exchanged for points and miles back and forth. That was documented and discussed in the Hilton forum a while back. I imagine you will find that thread and the document it links to of interest.

3) Inter-airline partnernerships are what I was trying to figure out last night. If I fly UA with DL miles, is DL paying UA? I imagine so. I suspect that intra-airline programs put the FF program in one cost center, and they negotiate a per mile reimbursement that goes from FF to operations cost center, or something like that. Inter-airline agreements would be modelled similarly, I imagine.


So, am I close? Somebody shed some light on this, even if it is to point a link to a good article on the subject (as I did in #2).

[This message has been edited by Rut Dog (edited 02-24-2003).]