I take exception to the word scam in:

It was a great way to earn money (with real money being invested, vs the 250,000 UA miles people were earning for signing up for a mortgage line of credit).

The article does reiterate that it is important to use the miles when you can.

Unless they moved the responsibility of assigning value to the airlines as part of the award reservation process. Generally fairly easy to assign a number on a given day; doesn't matter whether that number changes over time or not. At the specific point of redemption, it is worth x. Even when there could be some confusion, say Y fare versus discount fare, the lower amount could be used.

Swag: thank you very much.

Just let me put in a plug here for The Economist. It's a great magazine and far superior to any of its competitors. And for those of us who are constantly on travel status, we can pick up our issue on the internet. Way cool!

M8

Ten days until a British broadsheet rips off the article? A month until a tabloid does so? Two until a major US paper does so, and then for thenext six months all sorts of local papers citing it?

I liked this:

Also the mention that airlines are as addicted to selling miles for non-flight activity as some people are to collecting them.

I think it's that factor that pushes the situation beyond the normal "inflation" argument. The system would be far more sustainable without repeated devaluations if nearly all miles still had to be earned by flying. (Also liked how the article pointed out that various changes were forms of devaluation - some reporters get so sucked in by airline PR that they forget to mention that).

I didn't see the topic mentioned per se in the article, but would stick by my own prediction: Things will really worsen, tipping-point style, when the baby boomers start to retire. When people who traveled and collected miles for a lot of their careers but didn't have much vacation time to redeem start to want to travel more in post-retirement years (or otherwise spend what are high 6-figure or 7-figure mile balances), that'll really accelerate devaluation pressures. Airlines won't be ready with seats and will try to blame anyone but themselves (fuel costs?), and programs and their ability to motivate people will take a bruising, rolling hit as the conventional wisdom catches up to the reality of redeeming. The first baby boomers hit 62 in 2008 and 65 in 2011.

Page 102 of the Dec 24th 2005 - January 6th 2006 edition (special double issue) - volume 377 number 8458.
Cheers

The system would be more sustainable if airlines stopped viewing award tickets as "free travel" (which they are not), recognize that in many instances they are making more money from credit card companies purchasing miles than from customers purchasing tickets (i.e., the $400 in revenue cited by the article vs. maybe $250 for a coach ticket purchase), and start providing more award seats.

"... and start providing more award seats." But how can they offer more than 100% of seats on every flight each and every day for award redemption, which is what they do now?

Randy, please clarify. Are you specifically addressing award seats at double mileage?

"But how can they offer more than 100% of seats on every flight each and every day for award redemption, which is what they do now?"


Randy,

Well that's one we're are going to have to "agree to disagree on", as I would venture to say the average frequent flyer looks at it from a different perspective. Plus the fact that it's just not true in every case as you would imply.

For example: Northwest Airlines Rulebuster awards are still capacity controlled. Southwest Airlines, in the past the airline with the least restrictions, will soon have capacity controls on all flights, and will not be offering a double mileage award. And in almost all cases the double mileage awards that you are speaking of are not available on partner carriers.

Even without those examples the average frequent flyer expects to be able to use a standard award on their trip (knowing that they may have to be a little flexable). And as is so often the case it just not available. And that frustrates many people into feeling that they'd been promised this "free" trip, and then the airlines haven't played fair with them.

Here's an example: Houston to Denver on Continental Airlines departing July 8th, returning July 9th and not one seat is available in coach class on any flight in either direction. And when speaking with Continental I get the response that the awards seats are all booked up. So I then ask about August 12th, returning on the 13th - and still not one seat in either direction.

Is there a chance that numerous frequent flyers have booked up every seat? Maybe! But I would venture to say that they just haven't made many, if any seats available.

So how do we prove that the airlines haven't made ANY seats available. And is that fair if they don't make any seats at all available for a standard award?
Would you change your statement if I found a flight that no standard award seats were available on, and yet no seats had been sold at all. This may not be easy to prove in coach class, but it's very easy to do so in First Class. As I have done so in the past. I've requested award space in first class on a flight before, been told that nothing was available (that all standard award seats had been booked), hung up and proceeded to purchase (knowing that I could then cancel the reservations) every seat in first class.

I have the feeling the most people would disagree with your attitude that the airlines are playing fair. IMHO

My attitude? I must apologize then as i have re-read the post and was not aware it provided an attitude. As well, i did not read where i said the airlines were playing fair. But that aside, I was merely trying to point out that some airlines do provide 100% of their seats toward award redemption, ala American AAdvantage, etc. We do know that some airlines are better at rewarding seats than others and that's why FlyerTalk and InsideFlyer exists and that is to provide resources for members and potential members to compare the benefits and performance of various programs. It's fairly well known that many members pick programs based on what is most convenient for them, not by actually comparing the benefits and award redemption possibilities. Much like complaining that a Mutual Fund you have chosen is not performing that great compared to others you might have chosen.

You will read here on FT that many members never have a problem with redeeming any rewards, while others do have problems. But most of the media coverage would lead you to believe that no one can ever use their miles, despite the facts that the industry gave away more than 30 million free tickets last year.

I'm pleased that i have been able to force some changes to these programs over the years, so i am hardly on their side. I do believe that some of them are guilty of mis-marketing themselves and frankly among the 12 million miles i have accumulated they are well placed with programs that i feel are clear with my expectations. I have several times told both Continental and Northwest that they have created some of their own problems by designating their 25K awards as "Standard." It is not a standard award, the "standard" is the 40K-50K award with the 25K award being more of a limited sale. And while i understand the "double miles" comments from many members, it's one of half full or half empty, since in the origination of all these programs, there actually were no 25K awards, all awards for coach seats were 40K-50K or there abouts. It might be worth to note that between 1981 and 1988 when all coach awards were 40K + not a single member ever complained that it was too many miles for a coach award. It was the "standard" and all members were fine with it. Again, it is my personal opinion that several programs have bungled their image in the public. In the past when the Passenger Bill of Rights was a topic, I long argued to deaf ears that airlines needed to have clear rules for "saver" type awards. My call was that airlines would be required to set aside 10% of every flights seats toward the "saver" type awards. Thus on a 132 passenger plane, 13 of those seats were for 25K awards and the balance were for "anytime" awards. While not everyone would get a 25K award, at least it was clear they had a chance. As for the rest of award redemption things, there's always much more to the story. While you may have your personal and a few others experiences to draw from, I see other things - such as the more than 50,000 awards that have been redeemed through awardplanner.com. I see the results, destinations, successes, failures, opportunities, etc. So when I speak about award redemption, outside of an actual airline, and my observation may even be better since i see redemption's from all airlines and all hotel programs, etc. rather than a single view. On occasion I know i have had to use "double miles" but frankly that has never bothered me, nor should it bother most members of these programs. The vast number of earning opportunities have more than allowed me to pay "double miles" if needed. As we report in InsideFlyer, nearly 60% of miles than an average member earns come from non-flight activity.

So again, I'm not trying to argue any specific point of view, rather point out that in some programs the airline does provide 100% of every seat every day toward award redemption, so capacity is not the issue. The issue is what price do we want to pay? For these other airlines - research and change if necessary. And as for the "fair" system, I've long believed that in a good relationship, both sides have "rights." It is pretty difficult to "fairly" criticize airlines when some of us - including me - don't want to admit that this "Standard Award Travel is limited and subject to seat availability." is what we agreed to when we signed up for the program. They told us that award travel would be limited and subject to seat availability. and unfortunately, they were right.

As for me, I'll continue to try and influence the industry as i can and given that the New Year will bring about the 25th anniversary of these programs, have suggested that an airline or two take a leadership role and put some guarantees into award redemption so that at least we know better what the odds are.

But from me, no attitude, just thoughts and opinions.

Randy,

Correct me where I'm wrong (and I could be), but when I signed up for the prograns in the early 80's (and I'm guessing that's the same time that you signed up for the programs) most airlines were 25K (some even 20K - ie: Northwest Fly-writes) for a coach award without any capacity controls. This ticket could be booked at any travel agency, had no expedite fees, no Saturday night stay requirements, and thus was really a free ticket. That was a "standard" award ticket. The airlines then changed that standard award ticket so that it was what we now think of as a saver award. And then at a later date they introduced the new standard award tickets.

Mileage levels go up, rules change and that's all okay. But when an airline doesn' t make one seat available on a flight for a standard award ticket, at least IMHO that's not fair.

The airlines started out charging an expedite fee because an agent had to do "extra" work in order for you to receive your ticket in time for you to travel. Now you/we do our own booking and get charged a fee strictly because they can, and we don't have much of a choice but to pay it.

You can mention 50,000 free tickets being given away, or 50 million. But again IMHO if they give away enough miles for 1,000 tickets they should be obligated to make 1,000 tickets available. If they give away (and it was their choice to start selling miles) enough miles for 10 million tickets, then I think they ought to make 10 million seats available for "standard" award tickets.

Now I know you're not going to agree with that, but that's how I feel. And to counter what you might have to say about that maybe they shouldn't be selling so many miles at such a cheap price. For example, Delta Airlines is now going to require 250,000 mile to get a free ticket to Europe without any restrictions. And their logic, or concern is that too many people redeem 180K in the form of Amex/Membership Reward points and get a $7,000.00 ticket for doing so. But again, they created the situation. And the person who earns their miles by flying is the one being hurt.

All of the airlines (or most all) follow each other like blind dogs. If one does something the other does it because they feel the need to compete - without thinking about the end results.

I do think you have a different attitude that most people. The average person doesn't have 12 million miles to work with. The average person saves for a long time to get their "free" ticket. And then more often than not they can't get what they want. Yes thousands/millions of tickets get redeemed every year. And many people are happy. But you, and many of the people here on FlyerTalk are not the "average" traveler. And I don't think that average traveler (which is who I talk with every day) is all that happy with the programs as they are structured.

We are all told the programs could change, and they have. And very few if any changes have been for the better IMHO.

Not so much availability, but availability on the highest margin flights, i.e. trans-atlantic and trans-pacific?

I know I appear to be splitting hairs, but I never seem to have a problem getting a ticket for my daughter from say, DCA - FSD. On the other hand, I KNOW trying to get a ticket from OMA - HNL is gonna be tough if not impossible.

What I did one time was buy the coach and upgrade with miles. It worked because it didn't impact the airline's (in this case United) revenue stream like going for the free ticket.

Is this fair? I don't know. It's the system. It's a important revenue stream for cash starved airlines. If it's not fair, I'll switch (which is what I ended up doing..from UA to NWA). The $25 cost used in the article in the Economist is true up to a certain point,but if that seat grosses $1000 because it's going to Europe, then the cost to the airline is much greater. The opportunity cost is huge in that case.

I'll say it again, it's not so much free tickets as it is free tickets on the high margin routes that people have the greatest difficulty in getting. If you're a retired baby boomer with 12,000,000 miles trying to redeem miles for DCA-FSD, your chances of getting a free ticket when you need it are pretty good; if you're trying to get OMA-HNL in January, your chances are pretty darn low regardless of how many miles are in your possession.

Understanding the difference is critical if you're going to end up either happy...or sad. I seriously doubt the airlines will give away too many seats that produce a significant portion of revenue for "FREE" now or anytime in the future.


opportunityopportunity

"It might be worth to note that between 1981 and 1988 when all coach awards were 40K + not a single member ever complained that it was too
many miles for a coach award. It was the "standard" and all members were fine with it."


From my copy of a 1985 AA award chart:

50A. Two free Coach Class tickets on American Airlines or American Eagle.
50B. Free First Class ticket on American Airlines.

60A. Two free Economy Class tickets on American Airlines between the U.S. and London.
60D. Free Business Class ticket on American Airlines between the U.S. and London.

75A. Two free First Class tickets on American Airlines.

100A. Two free Business Class tickets on American Airlines between the U.S. and London.

Randy,

Your statement would imply that the airlines lowered their award levels after 1988, and that they are just now raising their award levels back to the pre 1988 levels and I would have to disagree with that. Today's "double mileage" awards are much higher than the unrestricted awards from the past.

As shown with the above award levels from 1985 two free coach domestic tickets were available for 50K, (25K each). And two free coach tickets to Europe were available for 60K (30K each).

IMHO the airlines have doubled their award levels, but to avoid getting everyone upset with them they still offer a "saver" award at the original levels - but it's just too hard to obtain.

The airlines have the right to raise their award levels as they see fit. And while I agree that you often do stick up for the average frequent flyer. I don't think comments like "since in the origination of all these programs, there actually were no 25K awards, all awards for coach seats were 40K - 50K or there abouts." helps with today's situation.

Happy New Year!