Airline Threatens To Sue Betting Site For Taking Bets On When It Would Go Out Of Business

from the what's-illegal-about-that? dept

Apparently, a Scottish airline, Flyglobespan, has threatened to sue an online betting site because it was taking bets on what airline would be the next to go out of business, and had odds on Flyglobespan. The site did stop taking bets, but says it was due to a lack of interest, rather than the threat of a lawsuit. However, it's not clear what law it would be breaking to offer such a bet. You can understand that the company is concerned that potential passengers might think the airline is at risk, but it's not clear that's enough to stop any such bets.

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Maybe Airlines Should Take A Page From Telcos: Pretend Extra Fees Are From The Government

from the oxygen-fee-anyone? dept

For years, we've pointed out how various telcos get away with adding extra fees to increase the price of service without technically "increasing the price." The sneakiest of these add on those fees with names that make them sound like they're required by the government -- even though they rarely are. A few times, we've asked how those sorts of fees might be applied to other businesses. Of course, we did so as a joke, using it to show how ridiculous some of those fees really were. However, it appears that perhaps it wasn't such a joke. Reading this NY Times article about all the new fees that airlines are charging passengers, it has to remind you of the sorts of fees seen on your telco bills lately. As far as I know, I haven't seen any airlines disguising fees as gov't taxes yet -- though it may just be a matter of time. Of course, the airlines are doing their best to ignore the criticism of things like charging $7 for a pillow or $2 for some water -- but as political cartoonists are noticing, it may not be long before people expect to be charged for oxygen masks or use of the bathroom.

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Airline Plans To Cancel All Flights Booked Through 3rd Party Websites

from the piss-off-your-customers-much? dept

And people wonder why airlines have so much trouble staying in business? We were already confused enough by American Airlines' desire not to be listed on the sites where people search for airfare, and easyJet's plan to sue the sites that send it customers, but Irish-based airline Ryanair is taking this all to a new level. Beyond just being upset about those 3rd party sites (i.e., sites that send it business!), it's planning to cancel the flights for everyone who booked through one of those services (thanks to Sean for the link).

Yes, we understand that these airlines prefer people to purchase flights from the airlines directly, but it still seems bizarre to try to cut off a great promotional channel. People already know to go look at 3rd party sites for airfare, so actively working against having your flights promoted doesn't make much sense. Then actively pissing off a bunch of your customers who booked through those sites by canceling their flights is even more braindead, as you've just formed a huge group of customers who will complain about your airline and spread the word about how you canceled their legitimately purchased flight for no reason other than spite and a confusion over business models. When Ryanair started promoting how some of its seats might come with sexual gratification, I'd bet many passengers didn't realize it would end with them getting screwed.

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The Airlines' Ongoing Struggle With Price Aggregation Sites

from the airlines-vs.-aggregators? dept

It's proving pretty difficult to figure out exactly what happened between American Airlines and Kayak last week. Last Wednesday TechCrunch reported that American Airlines was pulling its listings from the airfare search engine. Comments left by Kayak's CEO Steve Hafner and VP Keith Melnick chalked the split up to Kayak's display of AA fares from Orbitz: American had demanded that Kayak suppress the Orbitz listings, and Kayak refused.

Presumably one of two things is making American want to avoid comparison to Orbitz prices: either, as TechCrunch speculates, users clicking the Orbitz option put AA on the hook for two referral fees -- one to Kayak and one to Orbitz; or AA has struck a deal with Orbitz that provides the latter's users with cheaper fares than can be found on aa.com.

Either way, the news doesn't appear to be as dire as it first sounded. It doesn't seem that AA flights will be disappearing from Kayak -- it's just the links to buy them at aa.com that will go missing. As Jaunted points out this might wind up costing flyers a few more dollars, but it shouldn't be a major inconvenience for Kayak customers.

The more interesting aspect of this episode is how it reveals the stresses at play in the relationship between the airlines and travel search engines like Kayak. It's no secret, of course, that the airlines are having a rough time as rising fuel prices put even more pressure on their perennially-failing business model. But while an airline attempting to control the distribution of its prices is nothing new, one can't help but wonder whether ever-narrowing margins might lead to a shakeup of this market.

Kayak, like most travel search sites, gets its data from one of a handful of Global Distribution Services: businesses that charge airlines a fee to aggregate price and reservation information. Some airlines, like Southwest, opt out of the GDS system in order to avoid those fees. Others, like American, participate in the system but try to send as much online business as possible to their own sites. Presumably each airline tries to find an equilibrium point at which the business brought in by participation in a GDS and the payments associated with it add up to the most profit.

But so long as the financial temptation to retreat from the GDSes persists, GDS data will be less than complete. And that creates an opportunity for another kind of fare-aggregation business -- one based upon scraping the data from the airlines' websites. It's been done before, after all, albeit on a limited scale. And since most people recognize that prices can't be copyrighted, there doesn't seem to be any legal barrier stopping such an aggregator from stepping in (nothing besides the need to write a lot of tedious screen-scraping software, that is). Though, of course, that won't stop airlines from suing, but the legal basis for their argument seems pretty weak.

Whether such a business is likely to emerge and succeed, I couldn't say. But it does seem certain that as fuel prices rise we'll be seeing more and more travel industry infighting -- and more and more hoops for online fare-shoppers to jump through.

Tom Lee is an expert at the Insight Community. To get insight and analysis from Tom Lee and other experts on challenges your company faces, click here.

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What Airlines Need Is Airplane-shaped Boarding Areas

from the faster-boarding-times dept

Slashdot has an interesting post about some research about strategies for getting people onto airplanes quickly. This is a big deal for airlines because the planes are a major capital expense. Every minute the airplane sits at the gate is a minute it's not in the air earning money for its owners. Faster boarding times would mean a plane could fly more flights in a day, increasing total revenues. The researchers apparently found that the best method was "row-by-row, seat-by-seat, strict order," starting at the back of the plane. But they think flyers wouldn't go for that, because it would mean forming a long line in that order. But I'm not so sure. Here's what airlines should do: re-model the waiting areas so that the chairs are laid out the same way they are on an airplane, complete with a number on each seat. Ask passengers waiting to board the flight to sit in the chair corresponding to their seat on the airplane. Then, when it's time for the airplane to board, they're already in the right order and it's trivial to have them line up in that order for boarding the real airplane. It's true that this would cost the airlines some money up front, and it would lead to somewhat less efficient use of the waiting areas. But chairs and floor space are a lot cheaper than airplanes. If the arrangement allowed for even a small increase in the efficiency of aircraft boarding procedures, it would pay for itself in no time. The closest to this arrangement that I've seen is Southwest, which is the only airline I've flown on that doesn't have assigned seats. I always found it an annoying airline because I had to "camp out" in line to make sure I got a good seat. But Southwest recently revamped the process so that everyone had an assigned boarding number and are required to board in strict order. That way, people don't have to stand in line to hold their place, but the airline still gets the benefits of "open seating."

Timothy Lee is an expert at the Insight Community. To get insight and analysis from Timothy Lee and other experts on challenges your company faces, click here.

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Airline Innovation Could Take A Bite Out Of Delays

from the stuck-in-a-holding-pattern dept

It will come as no surprise to air travelers that this year has been the worst on record for flight delays and cancellations. Since technology failures played a role in some of the year's worst headaches, it's a fair question to ask whether better technology might fix what's broken with air travel. There's little debate that the nation's air traffic control system needs updating; contentions arise over who will take responsibility for it. Yet, while the FAA and the airline industry might spend another decade hashing out major infrastructure upgrades, the airlines should be investing now in technology that can provide relief to their customers in the short term. Investments to improve areas such as crew management, gate management, and flight scheduling, would take compounding bites out of the problem of delays. Yield management systems, technology in which airlines already invest substantial sums, could be tweaked to account for goodwill lost to cancellations and delays. Most significantly, more information given to air travelers, both at the time they purchase tickets and at the time they fly, will arm them to make better decisions about when, where, and whether or not to get on an airplane. Airlines would do well to consider how technology innovation could improve their customers' experience. Much as JetBlue distinguished itself early on by offering superior service, passengers will reward an airline that provides an overall better travel experience. Airlines need not fear the costs of making these investments, because the cost of not making them could be much higher. Witness, again, JetBlue, whose reputation and stock price have still not recovered from customer relations missteps made earlier this year. Instead, airlines that employ new tech to take some of the pain out of air travel may join the growing number of companies who find themselves rewarded by shareholders for providing better service to their customers.

Daniel DiPasquo is an expert at the Insight Community. To get insight and analysis from Daniel DiPasquo and other experts on challenges your company faces, click here.

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Two Airlines Move Ahead With In-Flight Internet Plans

from the looking-through-the-clouds dept

One of the many modern tech myths seems to be the idea that in-flight internet access is guaranteed to be a success, even though this has proven not to be the case. The supposed demand for the service among travelers hasn't been enough to overcome the cost of the service, both for airlines and end users, and technical barriers, as highlighted by the failure of Boeing's much-hyped Connexion service. Now, however, one of the airlines that offered Connexion, Lufthansa, says it's working with T-Mobile to bring back in-flight internet access, while American has signed a deal with AirCell to offer its service to travelers on some planes. Lufthansa wants a system that supports WiFi, but also SMS and cellular data, though it won't allow cellular voice calls; American plans to test WiFi access on some transcontinental domestic flights before deciding whether to proceed. The American system will differ from Connexion in that it won't use satellites, but an air-to-ground radio system, explaining why it will only be available domestically. Hopefully this will translate into lower costs for consumers than the $30 per flight Connexion charged, otherwise the service will suffer the same fate. Lufthansa is reportedly looking at a satellite-based system for its long-haul flights, and unless it's figured out some way to slash the costs of such a system and pass the savings on to consumers, it's hard to see things working out any better this time around.

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Frustration Soars As Airline Switches To Call Center For Support

from the emergency dept

For companies of all sorts, the lure of moving customer support operations to low cost call centers is often irresistible. But as many can attest, the money saved can show up as money lost somewhere else. The problems at Dell following its move to skimp on service are quite illustrative. It looks like the latest to fall into this trap is Hawaiian Airlines, which has seen customer wait times soar, ever since it outsourced its operations to a call center. This has resulted in lost sales, as well as, undoubtedly, a damaged reputation. The company claims that the long waits on hold are the result of a surge in volume, but that seems like too much of a convenient coincidence. Hopefully, the company has a plan to fix the problem. If it laid off a lot of its trained support staff, it won't be so easy to just call them up and ask them to come back.

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