DC as an intermediary (a.k.a. miles laundering)
 

Mods : feel free to move this if it is not in the correct forum : I am still new to the FT community.

I am wondering about this community's thoughts on transfers like AA --> Diner's Club --> Continental Airlines. I realize that half of the miles would be lost, but my question is actually more along the lines of ethics, in a way.

Do you see any problem with transfers such as this - that is to say, does it seem in any way wrong to any of you to use the miles that one company awarded you in order to gain free travel on its direct competitor? Would it be worse for AA in this example b/c they provided a means to use the competition, even for free, or worse for Continental, since they gave away a flight?

I am really just interested in the opinions of you out there in FTland - is it a bit "unethical," or do the companies ask for it by having a partnership with DC, which can act as such a portal?

I look forward to your responses.

Not the least bit unethical. The companies all win. AA loses an obligation to redeem its miles, buying them back from DC at what's surely a bargain rate (or more likely offsetting miles that DC would otherwise have to buy). DC wins by giving you half the CO miles that you gave it in AA miles. CO wins by selling miles to DC that you will then use for seats that would have been empty otherwise. You lose, but you seem OK with that. If you need the CO miles and have no better way to get them, do it. The companies do this because it profits them. Nobody forced them to.

And why should it bother AA if you get an award ticket on a competitor instead of with them? Might bother them a bit if you paid for a ticket on another airline, but an award ticket? No problem.

Besides, the way the game works is that they get to make the rules. Then we get to use those rules as advantageously to ourselves as we can.

Thanks for the thoughtful response!

The only loser here are the passengers.

Award seats are capacity controlled and usually fill up fast (especially on popular routes during high season). By transfering from AA to CO, not only did you lose a ton of miles in the tranfer, you will be taking away one award seat from another fellow traveller, who will now be forced to either fly somewhere else, or on another date. Of course, when he does that, he robs another traveller of his space, who will in turn rob another, and the cycle continues. Hell, it is like the airline's version of musical chairs!

Definitely agree. Sorry to say that the only real person who loses here is the passenger. Try a little creativity and see if you can get your ticket via AA, as AA miles are much more valuable than CO miles are.

Mike

Thanks for the responses. Just to be clear, I didn't actually do this transfer - I was just wondering about the feelings out there.

I believe I speak for my fellow FTers when I say this.

The only thing unethical here is how we are being screwed a**-backwards by the airlines when we do transfers from one program to another!

This person is not "taking away" anything. The blame should be placed on capacity controls. I don't understand why you would transfer miles from one capacity-controlled airline to another at a 50% haircut. Why not just spend the miles on AA and get a standard award? Why transfer them to CO and hope for a (non-existent) saver award?