Does BA's treatment of its frequent flyers imply an abuse of market power?
Mar 31, 2014, 11:35 am
#16
Original Poster
Join Date: Oct 2012
Location: England
Programs: BA Lifetime Gold, UA Premier Platinum
Posts: 389
Fully agree. The reason I started a new thread was to try to distinguish this issue from today's events. I agree that the YQ charges are the most egregious example.
Mar 31, 2014, 12:10 pm
#17
Join Date: Jun 2008
Location: London
Programs: AAdvantage, and BAEC in name only
Posts: 803
As a UK resident with varying travel patterns, the only sensible frequent flyer scheme for me to focus on is BA's EC. Other schemes may work for certain geographical destinations, but only BA can realistically offer me the range and depth of services. If I'm to focus on a single FF scheme - and that's the ultimate objective of loyalty schemes - it's difficult to consider anything other than the EC.
I travel on BA more regularly than any other airline, use the lounges and use Avios for upgrades but the terms of BAEC do not work for me and my lifetime TPs are zero. If I credited my flights to BAEC I would currently be OW Ruby instead of Silver, and I absolutely refuse to pay the scandalous fees for long-haul redemptions.
BAEC is not the only option.
Mar 31, 2014, 12:20 pm
#18
Join Date: Mar 2014
Location: London, UK
Programs: BAEC
Posts: 2,286
I am not a competition lawyer but maybe some readers of this thread are. Am I barking up the wrong tree, or is there a germ of an argument here? If there is evidence of market abuse, what would be the first steps in getting the competition authorities to take this further? It would be good to put a shot across the bows of BA - after all, the threat of a fine of up to 10% of annual turnover is much more likely to be effective than any number of letters to Franck van der Post.
One initial reason would be that there is no obligation to make use of BAEC if you fly BA. Many travellers choose to credit their miles to other OW FF programs and more may do so in the future if they are unhappy with changes to BAEC.
The important point is that consumers have both a choice of airlines and a choice of FF schemes even when flying on BA. For instance: if you don't like the new BAEC rules then switch to AA or CX. Anyone earning enough miles to reach BA Gold should also reach AA EXP / CX Diamond (and may well get a status match on CX - unsure on AA). Neither charge cancellation fees for their emerald members. Both offer benefits that BA do not (open doors on CX for instance).
I can't really think of many industries where one can spend one's cash with company A and accrue benefit with company B and expend that benefit with company C when not directly spending any money with companies B or C. The industry seems to be functioning pretty well and I doubt it is even remotely likely to be investigated for competition abuse.
Mar 31, 2014, 12:28 pm
#19
Original Poster
Join Date: Oct 2012
Location: England
Programs: BA Lifetime Gold, UA Premier Platinum
Posts: 389
Indeed, but the fact that airlines offer frequent flier benefits implies they are attempting to compete with one another. If BA really thought it had an enormous captive market of frequent fliers who had no choice but to fly BA, the logical response would be to scrap the Executive Club altogether. And if BA did that I can't see how competition law would interfere - an airline surely can't be required to operate a frequent flyer scheme.
Maybe like PhilWW I should start crediting to AA! But I do have a very large stack of Avios to work through!
Mar 31, 2014, 12:43 pm
#20
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Join Date: Mar 2010
Location: JER
Programs: BA Gold/OWE, several MUCCI, and assorted Pensions!
Posts: 32,146
BA Silver, formerly VS and MY (TATL only) when UK resident.
BA is helpful living in JER, with CW baggage allowances on the x-Channel and Lounge access as a Silver. So I've been 'loyal' for the last 8 years. But, as the BA negatives pile up (thanks, FT) I do really start to wonder why. I need to spend some time doing comparisons, but my 'faith' in BA is somewhat damaged.
BA is helpful living in JER, with CW baggage allowances on the x-Channel and Lounge access as a Silver. So I've been 'loyal' for the last 8 years. But, as the BA negatives pile up (thanks, FT) I do really start to wonder why. I need to spend some time doing comparisons, but my 'faith' in BA is somewhat damaged.
Mar 31, 2014, 12:43 pm
#21
Original Poster
Join Date: Oct 2012
Location: England
Programs: BA Lifetime Gold, UA Premier Platinum
Posts: 389
I would say barking up the wrong tree I'm afraid.
One initial reason would be that there is no obligation to make use of BAEC if you fly BA. Many travellers choose to credit their miles to other OW FF programs and more may do so in the future if they are unhappy with changes to BAEC.
The important point is that consumers have both a choice of airlines and a choice of FF schemes even when flying on BA. For instance: if you don't like the new BAEC rules then switch to AA or CX. Anyone earning enough miles to reach BA Gold should also reach AA EXP / CX Diamond (and may well get a status match on CX - unsure on AA). Neither charge cancellation fees for their emerald members. Both offer benefits that BA do not (open doors on CX for instance).
I can't really think of many industries where one can spend one's cash with company A and accrue benefit with company B and expend that benefit with company C when not directly spending any money with companies B or C. The industry seems to be functioning pretty well and I doubt it is even remotely likely to be investigated for competition abuse.
One initial reason would be that there is no obligation to make use of BAEC if you fly BA. Many travellers choose to credit their miles to other OW FF programs and more may do so in the future if they are unhappy with changes to BAEC.
The important point is that consumers have both a choice of airlines and a choice of FF schemes even when flying on BA. For instance: if you don't like the new BAEC rules then switch to AA or CX. Anyone earning enough miles to reach BA Gold should also reach AA EXP / CX Diamond (and may well get a status match on CX - unsure on AA). Neither charge cancellation fees for their emerald members. Both offer benefits that BA do not (open doors on CX for instance).
I can't really think of many industries where one can spend one's cash with company A and accrue benefit with company B and expend that benefit with company C when not directly spending any money with companies B or C. The industry seems to be functioning pretty well and I doubt it is even remotely likely to be investigated for competition abuse.
Mar 31, 2014, 3:21 pm
#22
Join Date: Oct 2011
Location: City of Kingston Upon Hull
Programs: BAEC Gold
Posts: 4,940
That set me thinking that maybe BA's (and the EC's) market position is so strong that they feel they can get away with behaviour/actions that would not be possible in a well-functioning competitive market. If so, that could amount to abuse of BA's market power, and might be grounds for a competition inquiry.
One option would be the break up of BA into a number of smaller airlines but this seems to go against present thinking and these smaller airlines would be vunerable to be taken over by bigger airlines. In addition the route network which is BA's biggest asset would be lost.
Another approach would be as suggested before is to keep BA but strip their LHR slots and auction them off to the highest bidder, how I would suspect there would be legal implications in stripping a private business of its assets.
There are those that argue that legacy carriers have too much power as it is difficult to establish a new airline (ask SRB) but name me a goverment who would be prepared to sacrifice their flag carrier for the sake of open competition. In the USA there are no one national flag carrier for the goverment to protect in the same way.
In summary, a competition inquiry ain't going to happen as would have no real power to do anthing.
Mar 31, 2014, 3:43 pm
#23
Join Date: Mar 2009
Programs: BA Gold A3 Gold PC Platinum
Posts: 154
i'm amazed at this thread in some ways.
BAEC has improved beyond all recognition in the last 5 years with the introduction of more tier points, 200% mileage for all fares for Silver and Gold + great value confirmed upgrades.....frankly i'd rather pay 50-70 quid and get a guaranteed Biz seat rather than go through the demeaning scrum so beloved of the Yanks to get a gate upgrade!!
The paid upgrades are also a great route for reaching Gold for me whereas I used to typically end up on 800-1100 points each year.
BA is a global airline with global competition and I personally see little or no evidence of market abuse...quite the opposite in fact.
Talk of class action suits is frankly depressing and another American import we could do without.
BAEC has improved beyond all recognition in the last 5 years with the introduction of more tier points, 200% mileage for all fares for Silver and Gold + great value confirmed upgrades.....frankly i'd rather pay 50-70 quid and get a guaranteed Biz seat rather than go through the demeaning scrum so beloved of the Yanks to get a gate upgrade!!
The paid upgrades are also a great route for reaching Gold for me whereas I used to typically end up on 800-1100 points each year.
BA is a global airline with global competition and I personally see little or no evidence of market abuse...quite the opposite in fact.
Talk of class action suits is frankly depressing and another American import we could do without.
Mar 31, 2014, 3:46 pm
#24
A FlyerTalk Posting Legend
Join Date: Aug 2006
Location: Argentina
Posts: 40,211
Mar 31, 2014, 3:55 pm
#25
Join Date: Dec 2006
Location: Lewes
Programs: HiltonH. Gold Starwood Gold BA BLUES! Mucci.
Posts: 4,833
Yes.
A friend of mine hit conformance, but it was very very busy, and he didn't get to the gate in time. Fair enough, worse things happen.
But the airline refused to help, despite him being a regular every two weeks, with multiple forward bookings, etc.
BA wanted to charge him over £300.00 single for the hop to Glasgow......
Luckily he gave me a ring and we got him on a Virgin flight for around £100.00
I have also noticed a complete lack of upgrade availability and no sight of poug upgrades on my upcoming flights.
Maybe all signs that we are moving out of recession and BA tightening up.....
A friend of mine hit conformance, but it was very very busy, and he didn't get to the gate in time. Fair enough, worse things happen.
But the airline refused to help, despite him being a regular every two weeks, with multiple forward bookings, etc.
BA wanted to charge him over £300.00 single for the hop to Glasgow......
Luckily he gave me a ring and we got him on a Virgin flight for around £100.00
I have also noticed a complete lack of upgrade availability and no sight of poug upgrades on my upcoming flights.
Maybe all signs that we are moving out of recession and BA tightening up.....
Mar 31, 2014, 4:22 pm
#26
Join Date: Jan 2009
Location: London, Sth Africa or LAS
Programs: VS Silver, BA Blue - finally; but hotels.com Gold :)
Posts: 1,858
I think a better example that might have traction from today's events is the arbitrary raising of phone booking and change/canx fees to £35, from £25.
As I understand it, the authorities' stance on this in similar areas is that such charges must be fair and reasonable and represent the cost of providing the service.
Well since my travel agent charges £30 for this sort of service, and uses it to underpin profit, then one would have thought £35 is significantly over-the-odds (this isn't just BA of course).
The weak point, therefore, could be the fairness of the level of the charge across the industry.
As I understand it, the authorities' stance on this in similar areas is that such charges must be fair and reasonable and represent the cost of providing the service.
Well since my travel agent charges £30 for this sort of service, and uses it to underpin profit, then one would have thought £35 is significantly over-the-odds (this isn't just BA of course).
The weak point, therefore, could be the fairness of the level of the charge across the industry.
Mar 31, 2014, 4:26 pm
#27
A FlyerTalk Posting Legend
Join Date: Jan 2002
Posts: 44,624
As a UK resident with varying travel patterns, the only sensible frequent flyer scheme for me to focus on is BA's EC. Other schemes may work for certain geographical destinations, but only BA can realistically offer me the range and depth of services. If I'm to focus on a single FF scheme - and that's the ultimate objective of loyalty schemes - it's difficult to consider anything other than the EC.
This reads more like a blinkered view on schemes ( which is great for BA ) rather than BA being able to abuse its position
Mar 31, 2014, 4:30 pm
#28
Join Date: Oct 2005
Location: @somewhere, if help needed use my email address [email protected]
Programs: BA & QR
Posts: 1,014
Booked Award ticket with LX to TYO in business one way and YQ was €235 plus the other taxes total was €286.
Other carriers like LH/LX/KL/AF do exactly the same as BA does.
Other carriers like LH/LX/KL/AF do exactly the same as BA does.
Mar 31, 2014, 4:32 pm
#29
Join Date: Jun 2002
Location: London, UK
Programs: BA Gold(OWE), QF LTG, MR Plat, IHG Spire, Hertz PC
Posts: 8,156
If you are really worried about some of the recent changes at BA, may I direct your attention to NZ, QF, DL, AF and LH - all of which have made far more drastic changes than anything seen at BA. NZ and QF in particular have made some pretty nasty changes which dwarf anything happening on this side of the world. DL is very much leading the charge for all revenue measures on the other side of the Atlantic (although appear to be on a quest to improve service), and finally AF and LH who have made their programmes lukewarm at best.
Whilst I am not a fan of the changes and even less so about the pitiful amount of notice we have all been given, perhaps these recent changes are not to be too bad in the overall scheme of things.
Whilst I am not a fan of the changes and even less so about the pitiful amount of notice we have all been given, perhaps these recent changes are not to be too bad in the overall scheme of things.