FlyerTalker78341

I completely agree. The owner of PP, the Collinson group, is actually sort of an insurance company.

I'm sure they are very good at estimating the expected number of lounge visits per individual and are even able to break that down by location. (I imagine what the pay lounges is highly variable. Some lounges in Central/Eastern Europe have walk-up fees of less than 15€. In such places, it seems save to assume that PP pays <10€ per visitor.)

FlyerTalker78341

@davie355: This is an international forum and not everybody has access to attractive CCs which include PP. Also, sometimes PP runs promos in cooperation with hotel chains or airlines which reduce their usual price by up to 40% or so.

flyercity

sjm0028

I wonder if airlines subsidize priority pass restaurants. BOS just changed so there is no security side access between terminals B and C (also no E to B access). There is a restaurant Steffanies that has locations in Terminal B, C and E, but the only one that takes priority pass is the terminal B location. Airlines in terminal B are AA, UAL and Air Canada. I wonder if one of those airlines subsiidizes either Stefanies or PP. I think all Stefanie locations have the same menu.

mia

This suggests that the B location has surplus capacity (i.e. they need more business). I don't see how you infer that there is some type of subsidy?

Dubai Stu

My wife and I primarily fly Delta and have access to Delta lounges outside of Priority Pass. Priority Pass is our backup. We use it in Dubai (not located there anymore but haven't changed my handle), sometimes in Brisbane, Fiji, sometimes in the Netherlands (now that Delta life members can't use KLM anymore). I've got Centurion Lounge access and Delta Lounge Access. We probably use Priority Pass ten times a year. Very few of our stays are over an hour. I don't see the issue.

OskiBear

I currently have PP through a half-dozen credit cards. A few of them offer unlimited visits + 2 guests, one offers 10 visits per year, and the rest offer membership with a per-per-use arrangement.
I'm basically down to just using one of the unlimited memberships.

However, consider how many "flat fee" arrangements PP has collected from my various cards and is only paying out usage on one card. Perhaps the ubiquitous inclusion of PP in travel credit cards is part of their strategy to ensure multiple duplicate memberships per individual with really only one that is ever utilized.

1353513636

I'm kind of curious why restaurants aren't scrambling to sign up to be part of PP. Is there some kind of contractual reason that many restaurants can't participate? What is better than people giving you business spending other people's (in this case PP or your CC issuer) money?

tmiw

A lot of restaurants in airports are actually run by the same few companies (for instance, HMSHost and SSP America), so there might be some contractual complications involved. It's possible all of their restaurants would need to be on PP, not just one or two per airport.

newflya

Who says they can't? I would assume either the restaurant doesn't want to join or PP doesn't want to sign-up the restaurant. Problems with organizational architecture--as suggested by the previous poster--may play a role here and there, but I find it pretty far-fetched to think that's the dominant factor here.

Sealink

Because I don't think they are all getting USD 24.00 per visit...

newflya

That's one thing.

For another, PP's speciality is sort of making good use of spare capacity in lounges. They're likely getting quite good deals with the lounges. Perhaps they're sometimes paying even less than the main airlines using the lounge. After all, PP's customers get lower priority, sometimes enjoy fewer services (e.g., extra section just for business/elite travellers, not for PP users; PP user co-payment for shower, etc.) PP helps improve lounge's capacity utilization so they can add to the lounge's bottom line even if they pay very little (but more than the variable costs..)

So why should they sign up restaurants if they have a decent lounge portfolio at a given airport? The major factor behind the restaurants from PP's perspective is to close gaps in their coverage. Sure, this improvement-of-capacity-utilization idea plays a role there, too. But from restaurants' perspective, PP is a bit of a slippery slope. More so than for lounges. The buzz word is product cannibalization.

8MiHi

I have no doubt that Priority Pass gets a guaranteed cash flow from the CC companies. As noted by others above there most likely are many CC holders who have the card who rarely ever use it but are happy to have it. It is an excellent inducement to take on a Travel themed CC . It helped get me even though I have Lifetime United Club access.

Leeroy75

I wouldn't agree on your point about Uber though. They take around 25% off drivers earnings, so I'd say that's profit.

Artpen100

I'm sure PP is getting a good cash flow from CC companies where many holders never use it. I have friends with Amex plat who are like that. I mean, they would, but just don't travel all that much. They might use a Centurion once or twice a year. Also, even for frequent travelers who've been in a lot of PP lounges, the restaurants are a little more trouble to use because you need more time. From my two restaurant experiences, you will need at least an hour - and I have seen them when they have long lines for a seat at meal times, and just passed them by. For lounge use at departure or on many connections, I am often physically be in the lounge for no more than a half an hour or so.