At what point do people start





?????

And this is the most obvious of the many flaws in the universe you've created. It isn't anywhere close to reasonable to start an exercise with a wholly unrealistic premise.

Plenty of the folks in the B6 forum discuss using a reward one way and paying revenue for the other segment. So actually the ability to redeem one way is making the rewards easier to redeem. And that was with TB1. With TB2 the points have a dollar value and there are no limits on redemptions. So the parallels fall apart pretty quickly.

I appreciate your comments about my knowledge. The tone of the examples you've cited don't bear it out but I'll go with it.

Around 9pm last night, I suppose.

I am afraid that I don't see the flaw in my universe but I would be happy to read your explanation.

As far as your second point, where's the problem? The miles that would have been used on the return segment are still unused (which is good for the company) and the customer has paid hard cash for the other segment (which is good for the company).

Where is it ever bad (as far as the company is concerned) for the customer to spend $$$ vs getting a freebie?

Plus on a carrier like CO that technique would not likely be beneficial to anyone except the company since one-way fares are so expensive.

There are more miles than seats out there. Artificially capping the total number at 37,500 makes no sense.

The second point I was making was to counter your theory that having one-way rewards would preclude return trip folks from booking rewards. They would still book them, more easily than before because they can pay for the return trip in cash and not have to find both directions as a reward trip. Sure, that means the airline gets some cash and some miles off the books but most of the time they prefer all cash and no miles redeemed.

Would it be better for CO for me to spend 25000 miles on UA (for a roundtrip ticker ) and then buy 2 round trip tickets on UA , or to spend 37500 miles on CO and buy 3 1 way tickets on United ? I would rather spend the money on CO (and upgrade using 15000 miles ) but those upgrades are hard to find .

Of course my example is simplistic. It was intended to be, in order to make the point.

In the real world, there are millions of miles in customers' accounts, but relatively fewer award seats. If anything, the real world would magnify the effect I described in my simplistic example, because the asymmetry would affect many more potential roundtrip redeemers.

As far as the second point, I still don't see how the airline suffers. No matter what, as long as customers are paying cash and keeping the miles in their accounts, the company benefits. The more expensive the one-way ticket paid in cash, the more the company benefits. But even if the one-way ticket is dirt cheap, the company benefits twice, first by keeping the miles away from an award and, two, by earning at least a little cash it othwerise would not have.

The point remains that one-way redeemers add to the scarcity of roundtrip award inventory by creating asymmetry. If they are really doing a roundtrip by buying one of the legs, then the company benefits anyway.

Where's the problem?

If there are actually 200,000 points out there split amongst eight passengers each with 25,000 (almost equally simplistic an example) then It doesn't really matter if one of the eight redeems for a r/t or if two passengers each redeem 12,500 for a o/w trip each. The same total number of miles is redeemed. In that sense the airline still collects 100% of the total miles that were going to be redeemed, just from two passengers rather than one.

But when the opportunity to play a bit of arbitrage with the miles and cash comes into play - namely the ability to book one way with cash and the other with miles - the difficulty in booking reward trips decreases. Certainly the chances of a passenger booking a one-way reward to London and then paying for a one-way ticket home are lower than NYC-LAX and back, but the option is there. Folks have been known to do similar things to get to CMB to start RTW trips, for example.

It is easier to book a reward trip when you only have to find inventory in one direction rather than both. Reducing the barriers to reward redemption increases the value to the consumer and that inherently reduces the value to the airline.

The airlines would much rather sell you a round-trip ticket than a one-way reward and a one-way revenue ticket in the vast majority of cases. Yes, the miles are a liability on the books but the cash income is worth more, even on those $99 transcon fares. It is all relative, so to speak, but the airline benefits more from the cash.

On the asymmetry front, back to our eight customers above. When it is easier for any one of the eight to book any one reward segment then the overall number of reward seats redeemed goes up, not down. Customer number 6 might not get the reward trip she wants but if number 3 and number 8 each book a one-way then the net effect to the carrier is the same in terms of miles off the books and revenue impact.

But if there are only reward seats on odd days and each of the three passengers want an outbound on an odd day and a return on an even day then you can either have some miles redeemed and less cash or all cash and customers still earning miles rather than burning them. The latter scenario is better for the carrier.


Yes and no. The company clearly benefits more in terms of revenue if every redemption is a one way with cash for the other half. But there is no guarantee that the other half will be on the same carrier. There is no guarantee that the same overall number of redemptions would happen. And at the very macro level there is no reason to believe that the "other half" of that asymmetric scenario you've described would actually not be redeemed by another customer somewhere down the line.

If I understood your scenario correctly (and if I didn't, I apologize) you're discussing a passenger booking one roundtrip reward as compared to one or two passengers booking two one-way awards.

There is no doubt that is precisely the same thing. There is no benefit to the airline, nor is there a cost. It's a zero-sum game.

If anything, a slight advantage still goes to the two one-way redeemers, because in most cases each redemption involves a cash fee, so that the cash earned from two one-way redemptions will exceed the cash earned from one roundtrip redemption.


Of course, but this is where the company can "outplay" the players, because every time one of these wily customers plays the system, he or she is adding asymmetry to the system. The one-way award is worth at least the same amount per segment as the rt, but now a roundtrip redeemer is locked out of at least one seat on this segment. That fact alone benefits the company.

In the traditional linear analysis of this asset, that has been the going wisdom in the business. But for all the reasons we have discussed here, I think that is not necessarily correct.

Obviously the airlines would prefer to sell a round-trip ticket than to have you go one-way on an award ticket and then sell you the return. But by the same token the airline also prefers to sell you a one-way ticket and have you take the freebie on the other leg rather than have you do the freebie in both directions. It's the same principle.

Of course, the airlines are the ones who came up with the idea of award travel, so sooner or later they have to allow redemption. But if a one-way award allows them to give the customer the option to only redeem a one-way award and then spend cash for the other leg, then they have added a revenue opportunity, all the while adding to the scarcity of inventory to roundtrip redeemers through asymmetry.

Here's the thing, the awards are easier to book only for the one-way redeemers. As a direct result of the one-way redeemers, the awards become harder to book for the roundtrippers. On balance, therefore, fewer total miles are likely to be used in the long-run, which benefits the company.



Even if the customer takes the other segment on a different carrier, the company still benefits, because this behavior adds to the asymmetry. Of course, they would prefer that you returned on their airline, whether by using cash or miles, but every one-way award used blocks double the miles from being redeemed on a roundrip award.

As an AA'er, I disagree.

For my redemption habits I've found AA's system to be far more powerful with one-way awards, despite the loss of the stopover (assuming you're needing to stopover at the international gateway, as they still allow that.)

Granted you'll run into the issue of possibly having to buy another ticket or reward (and even then you'd still be only paying half) but the ability to do true oneways on AA and partners is not something to be underestimated...plus honestly, IMHO the AA forum overreacted to the loss of the stopover.

And besides you can still structure the awards to do a stopover (and open jaw) just as long as you do so at the start of the award:1 stopover (or 2 if you wanted to visit your US int'l gateway) and an open jaw (or double jaw if you wanted to return to another city.)

How about CO implements 'Pay with Miles' (like delta has) . If the fare is 250$ then that would cost 25000 miles or 30000 miles for a 300 fare ... ). It may not be as good a deal the 25000 miles for a round trip but if one is non elite then that may help them .

No way am I going to use my miles for a fare that values the miles at $0.01/mile! That's a cash fare for me. If I can't get at least $0.02/mile value upon redemption, I hold on to the miles for a later date.

It may be not be the best deal but if you are short on cash and need to go someplace its better than paying 20% interest on credit cards . It maybe a better deal for CO then for me but that is fine . If you don't have flexibilty in travelling then this may help out that way .

FWIW, you don't need a one-way award. You just need future travel.

Book the segment you need. Then, book another segment using at least one of the cities from the first segment. With a little planning the date of the second segment can be changed for free, to a more convenient time.

I don't know. It sure would be nice to have one-way award. I like the AA system as described by J.Edward.

hi flyertalkers!
a little background on the reason i asked my original question. this summer i'm planning a trip from moscow and return from helsinki. i need 80k to go in bf and return in y and i'm a few miles short now. the plan was to buy the united seat to moscow with ua miles since it's on their metal and then a 1 way home from helsinki on co metal with co miles.

plan b is to buy the r/t in y with co miles and when i scrape some more co miles together upgrade the moscow leg. but i hear that can be tricky because i have to essentially cancel my trip and rebook. the csr i talked to recently said that they are working on an enhancement (which is a phrase that i liken to the line "the check is in the mail") that will allow them to upgrade the existing reservation.

any insight?