There are only two real game changing innovations in rental cars that I can think of in my lifetime. One is keeping your information on file so that you can be pre-assigned a car and take off by showing just your driver’s license. The other is picking your own car.

Avis recently has been experimenting with the pick your own car concept in some locations. The pioneer in the space, of course, is National with its Emerald Aisle. I love National’s “Go Like a Pro” slogan because their Emerald Aisle concept, to me, is the perfect frequent business renter feature.

But there are really only five major travel stories that resonate with the public, and one of them is “summer travel.” So I don’t blame National one bit for looking to catch a little bit of attention with summer.

National Car Rental wants to help you get out of the office and enjoy what summer has to offer. So they asked me if I’d help them with a giveaway here on the blog. And since I don’t take anything myself when I do those, I have two of National’s “Summer On-The-Go” Prize Packs:

• Package one: Apple iPod Touch, $250 AMEX Gift Card, National-branded swag
  
• Package two: Apple iPod Touch, $50 iTunes Gift Card, National-branded swag

Since National – whose image is primarily as a business travel rental company – wants to blur the line between business and leisure travel this summer, here’s what we’re going to do.

There are several ways you can leverage your business travel to add a leisure component, from renting a car and getting out of the city you’re visiting (Heading to Austin? Drive to Lockhart for Barbecue!) to doing meetings offsite maybe outside in a park or a restaurant on the water or other scenic location, or even extending a business trip to give yourself a day or a weekend in a new location.

Entering is simple:

1. Take a picture of yourself adding leisure to a business trip or business meeting.
   
2. Follow @garyleff on Twitter and tweet the photo, mentioning @garyleff and #SummerOnTheGo. Do this no later than Friday, May 24 at 8pm Eastern/5pm Pacific.
   
3. I will draw the winners at random early next week from those that meet these guidelines and direct message the winner for an email address so we can get the prize out.

The fine print: the contest is open to US residents only (talk to the lawyers on this, sorry!). I’m the final arbiter in all matters related to this contest and in all matters of interpretation. There is no appeal. I’m doing this because there’s an opportunity to send out some cool prizes from a brand I like, and not taking anything from them in return, so please don’t give me a hard time in the process.

Any questions? Ask away. And remember that while you can share your thoughts here, or post your photos on instagram, only twitter entries count this time.

A couple of years ago the story went ’round about Rabbi Binyomin Ginsberg, a Northwest Airlines Platinum elite who apparently complained too much and had his frequent flyer account shut down. He lost hundreds of thousands of miles (and his elite status) in the process.

Ginsburg sued. His complaint was dismissed in federal district court on the basis that state law can’t be used to address airline price, route or service issues since those are pre-empted by the federal Airline Deregulation Act.

A 9th Circuit Court of Appeals ruling disagreed, and now the Supreme Court will hear the issue. The Supreme Court’s docket is here.

I admit I’m a bit surprised by the Supreme Court’s willingness to take this case, although I have not yet read the 9th Circuit’s decision (but I have read the petitioner’s brief to the Court).

Delta argues that the 9th Circuit’s ruling is inconsistent with Supreme Court precedent as recognized in other circuits.

The issue here at this point is whether the District Court was correct to throw out the case as being precluded by the deregulation act which forbids certain kinds of state regulation of airlines.

Under the Court’s American Airlines vs Wolens decision, a suit for breach of contract by a frequent flyer program shouldn’t be pre-empted by federal law. However, in my rudimentary understanding, a claim created by state law (in this instance, an implied covenant of good faith in Minnesota law) would be barred.

The airline’s claim that they terminated the Rabbi’s membership over complaints related to service doesn’t mean that suing over alleged breach of contract by the mileage program means the state law addressing breach of contract is in fact impermissibly regulating service. But the Rabbi’s claim of breach of contract was thrown out by the District court and is not at issue here.

What’s being considered is not what’s in the Northwest Worldperks contract (I haven’t re-read it, but I’m confident it would have permitted changing of terms and termination of membership). What’s being considered is whether, aside from the contract, this is ‘fair’ under state law.

If the terms of the frequent flyer program are considered pricing and service under the Airline Deregulation Act, as Delta contends Wolens clearly says they are, then the Rabbi’s claim under Minnesota state law is pre-empted. If the terms of the frequent flyer program are entirely apart from the basics of operating an airline (the airline service, ticket pricing) as the 9th Circuit believes, the claim should be allowed.

In some manner it comes down to whether operating a frequent flyer program is part of operating an airline, with the miles a rebate for ticket purchases (and thus part of its pricing) or whether operating such a program is in effect a side business distinct from the operations of an airline.

And even if a frequent flyer program was primarily about flying when Wolens was decided, it might no longer be so now that a majority of miles are earned via financial services activities rather than flying.

I’m not especially sympathetic with the Rabbi whose couple dozen complaints seem a bit much, and I do not blame the airline for firing him as a customer. It seems to me that this ought to be a two-way decision, the Rabbi could choose not to fly an airline any longer if it wasn’t providing him the service he expects and an airline ought to be able to choose not to sell tickets to someone that it finds is too costly to satisfy.

On the other hand I do think that confiscating earned-miles is extreme, and I’d certainly seek redress of that myself if I could.

While I don’t think the Rabbi’s desire for a class action lawsuit makes sense, I also think there’s an important principle in Supreme Court jurisprudence potentially at issue and I’d hate to see Wolens narrowed or even interpreted in a time capsule, as though frequent flyer programs are what they were 18 years ago when the case was decided. Delta (which took over Northwest) is represented in the case by former Solicitor General Paul Clement, a real legal heavyweight.

The case will bear watching, entirely apart from the specifics of a kvetching Rabbi.

Do any of lawyers among my readership care to weigh in, especially to contradict or correct my read of the case?

(HT: LarryInNYC on Milepoint)

A year ago I broke down the deficiencies in the Marriott Rewards elite program. Some of those have since been corrected, at least a little bit.

Marriott Gold status comes after 50 nights, which is average for top tier status with other chains. Platinum takes a whopping 75 nights. One would expect superior or at least industry average benefits at that level.

And yet late checkout is on request only, day of departure (rather than guaranteed). Resorts are excluded — but since it isn’t guaranteed, why exclude resorts? Other chains exclude resorts from their guarantee, but will generally oblige subject to availability which is all Marriott is offering anyway.

Marriott’s breakfast benefit has also been weaker than the competition’s — free breakfast in the US and Canada has been guaranteed Monday – Friday only, with resorts excluded (although some properties extend it as a courtesy on the weekends anyway).

Marriott Boca Raton goes above and beyond, offering restaurant buffet breakfast when their club lounge is closed

Now the great weekend fast appears to be ending. Nancy Trejos reports in USA Today,

Starting June 22, Marriott Rewards Gold and Platinum Elite members plus a guest will get free continental breakfast seven days a week in the lounge or restaurant of participating hotels in the U.S. and Canada, the company will announce Tuesday.

If you’d rather not claim your muffin in the morning, you can opt for an additional 750 rewards points, instead.

Presumably the resort exclusion will continue to apply. And Marriott Courtyard properties apparently will not begin offering breakfast to elites, either.

The piece does make it sound as though Marriott is doing something industry-leading, mentioning only Starwood’s offering of free breakfast as a choice to Platinums. Starwood Platinums choose between their check-in points amenity and breakfast, while Marriott Rewards is offering points in lieu of breakfast but not as a substitute for the check-in amenity.

Unmentioned is that Hilton offers breakfast as a benefit to Gold and Diamond members, and Hyatt offers full breakfast (not just continental breakfast) to Diamonds when there’s no club lounge available.

Last month I surveyed which chains offer the most generous elite breakfast benefits. And while the option to take points instead of breakfast when there’s no lounge available on the weekends will be nice, Marriott will still lag Hyatt, Starwood, and Hilton due to the (presumably continued) resort exclusion.

News and Notes from Around the Interweb:

• Back in October I explained how to get free Marriott silver status. It still works.
  
• Travelocity is offering $50 off a hotel booking of $150 or more when you download their mobile app.
  
• Anyone with a valid American Express card can get a free one-year membership to Shoprunner (or an extension of a free membership). That gets you free two-day shipping with a variety of merchants, and is generally stackable with mileage mall earning. (HT: Dan’s Deals)
  
• In March I wrote that American Express’ Bluebird 100 paper checks tied to your account for free. The last day to take advantage of this is Tuesday (tomorrow).

Heels First Travel has a DYKWIA seatmate furious that the airline didn’t hold her connecting flight and muses on why an airline may choose to do so – or not to do so.

It was something like “I showed up at the gate at 7:59 and they said the flight was supposed to leave at 7:55 and was already taxiing. I don’t know why they couldn’t have held the flight, it’s the same airline, they knew my flight was arriving late, I mean they even had new tickets printed for me. Now I can’t leave until 1:20PM. I’m never flying this airline again.”

Airlines won’t generally hold an aircraft for a late arriving passenger.

• Holding a plane for 10 minutes may cause other passengers to misconnect on their next flight.
  
• Holding a plane means it likely arrives late, takes off late on its next flight, and faces continued delays which cascade through the day.
  
• Any time you delay a flight there’s the chance for other things to go wrong — be it more weather delays, if heading into a congested airport you might lose takeoff slot, and then those things cascade — for the two reasons above but also risking crews timing out especially if late in the day.

Bottom-line is that holding a plane can be very costly. American thinks they can reduce their average boarding time by 2 minutes by allowing passengers without carry on luggage to board early. If they’re right they consider that a big win.

When considering how to accommodate a passenger they need to compare the cost of that one passenger versus the cost to all of the other passengers, and the airline. There are unseen tradeoffs, and in general airlines try to balance these things as best they can (with imperfect information – they don’t know what plans each passenger has in order to weigh relative importance/subjective costs).

Still, airlines do hold aircraft. In March United held a flight so a man wouldn’t misconnect enroute to seeing his dying mother. A couple of years ago Southwest held a flight for a man going to see his dying 2 year old grandson. Stuff like that is compassionate and generates good publicity. And failing to do it will generate a media firestorm.

When I toured the American Airlines operations center last year during the oneworld MegaDO, they explained why they had cancelled the flight that MegaDOers participating in the optional European portion the day before were traveling on. Those passengers (and others on London-Dallas) could be fairly easily re-routed. A flight needed to be cancelled. Cancelling, say, London-Chicago instead would have been far more problematic — apparently there were a large group of passengers onboard continuing onto American’s Chicago – Tokyo service. I wouldn’t have expected that (most would just fly London-Tokyo non-stop!).

It’s not just which connecting flights get held, but also which departing flights get priority — when weather reduces an airport’s ability to handle takeoffs and landings, the airline will generally pick which flights get limited takeoff slots. And they’ll apply a similar rubric — a flight that’s carrying a substantial number of connecting passengers, especially passengers to connecting to a once daily international flight, is likely to be given priority.

Heels First was right to conclude, about her seatmate,

In this particular person’s case, it sounded like she was the only person affected by the delay and they could easily accommodate her on another plane leaving later without having to throw off the entire flight schedule for one person. Not to mention if missing one flight would cause her to “never ever ever fly them again” she’s probably not a customer worth keeping.

And she was probably right also not to tell her seatmate this.

Earlier in the month I shared details of the upcoming Star MegaDO frequent flyer charter adventure.

Join a couple hundred of your newest frequent flyer enthusiast friends, meeting with airline executives, getting behind the scenes tours, bringing home amazing souvenirs and memories, and earning bonus elite qualifying miles in the MileagePlus program along the way.

These events sell out quickly in days or even minutes. So if you’re interested, pay attention.

“North of the border to the desert to the sea”

• When? October 22nd-25th
• Partners: Air Canada, Marriott, Rimowa, Star Alliance, United
• Routing: Toronto – Tucson – San Francisco
• Touring: Rimowa factory, Air Canada, Aircraft Maintenance And Regeneration Center, plus a United Airlines Hanger Party
• Miles: 2500 – 15,000 elite qualifying miles with participating airline(s) depending on class of service

The new MegaDO website is up and bookings for this trip will open today at 1pm Eastern / Noon Central / 11am Mountain / 10am Pacifc.

So what’s a MegaDO? November’s Star MegaDO 4 chartered United’s first 787. Frequent flyers got to experience it in a fantastic party atmosphere, and it was covered by the Economist, by the New York Times, by the Wall Street Journal and by… the Wall Street Journal.

Intercontinental Hotels Group (includes Holiday Inn, Crowne Plaza, etc) will be offering $50 rebates when staying 2 consecutive weekend nights and paying by Mastercard between May 31 and September 1.

Registration will be required, but the website to register is not yet working.

You can earn no more than one rebate per weekend, and no more than four total per household during the promotion period. And like last time, they make the process just cumbersome enough that I suspect the intentionally are hoping people don’t fulfill all of the steps necessary to get the rebate in order to lower their fulfillment costs.

You actually have to mail documents in order to claim the rebate. You send them a copy of your registration confirmation and also your hotel folio with reservation number. As with all such things, keep copies of everything, whether this is a feature or a bug you may need to follow up vigorously to get your $50.

Still, it’ll be worth registering now and then sending in the paperwork if you have qualifying stays during the promotion period.

(HT: Loyalty Lobby)

One couple did, getting ticketed to Dhaka (Bangladesh) instead of Dakar (Senegal).

It turns out the mishap all came down to the three-letter airport code airlines routinely use when making bookings or entering information on baggage tags. Instead of entering DKR (for Dakar) in the computer system, the airline representative entered DAC (for Dhaka), sparking the intercontinental travel nightmare.
The couple, flying on Turkish Airlines, transited in Istanbul before joining their connecting flight to what they thought would be Dakar. They told the LA Times they didn’t notice anything was wrong, because they went by the flight number on their tickets. And the similarity in city names didn’t help matters. “When the flight attendant said we were heading to Dhaka, we believed that this was how you pronounced ‘Dakar’ with a Turkish accent,” Valdivieso said.

It was only after seeing a route map several hours into the flight showing their plane hovering over the Middle East that the pair realized something was wrong.

Usually when this happens, travelers find themselves on a flight to Sydney, Nova Scotia.. realizing something must be wrong when they board a Dash-8 aircraft from Halifax and start to wonder how it could possibly make it all the way across the Pacific?

(HT: uggboy on Milepoint)

Conde’ Nast Traveler has just posted three videos featuring my advice on a variety of subjects.

In this week’s edition of tips from our Top Travel Specialists Collection, we hear from Gary Leff, our specialist when it comes to award tickets and cashing in all manner of frequent flier (and frequent guest) points.

In these clips, Leff talks about the very best time to cash in your frequent flier miles for free seats—and it’s not necessarily on the 331-day timeline that’s so commonly thought of as the gold standard for award bookings. Leff also shares good tips about getting into business- and first-class cabins, where service is naturally that much better. As aircraft shift and global airline alliances change, Leff shares his tricks for making sure you’re in the best seat available.

In another clip, Leff has tips on hotel award programs, which offer freebies far beyond just free room nights, including free upgrades, free internet access, and oftentimes free late check outs.

The subjects of the videos are:

• When is the best time to book award travel?
  
• What are the best hotel perks for business travelers?
  
• What are the best first class rewards?

Each one is 3-5 minutes. So it won’t take long for you to watch them all.

Via Reader Alan H., TripAdvisor is finally going big in hotel metasearch as a way to drive bookings.

Hotel chains’ have long tried to push guests towards booking through their own channels, such as by denying elite stay credit (and in some cases elite benefits) to bookings made through online travel agents and by offering their ‘best price guarantees’ meant to suggest that customers will get the best deals there (not always true, it just means that on some rare occasions the chains will reward customers who discover they haven’t).

That’s because the payouts to online agents for hotel bookings are huge, although seem to have been coming down somewhat recently. I used to see major chains paying out commissions in the high 20% ranges, while more recently such high payouts seem to apply more to independent hotels. The savvier big chains like Marriott, depending on the online channel, may be down into the high teens.

Whereas flight sales isn’t especially lucrative, hotels bookings are, and TripAdvisor is naturally positioned to get a strong piece of that action — they (in theory, with problems) guide you towards the hotel that’s right for you. They should be better at monetizing that decision. That’s seen as a threat to Kayak.

Interesting, while the leading threat there ought to be coming from Google, which is certainly trying to provide customized answers and advice in the travel space, the conventional wisdom offered in he article on Kayak vs. Tripadvisor is that Google hasn’t made much of an impact. So much for the anti-trust concerned voiced by Google’s rivals in trying to get the US government to shut down Google as a competitor (mostly, to date, in flight search – and fortunately unsuccessful).

I’ve often found TripAdvisor useful (1) for real guest photos, and (2) to scan common themes in reviews. But never for the rankings, and never for the content of any single review.

There are several problems with TripAdvisor. One is fake reviews — hotels with fake personas trashing their competitors, hotels giving themselves high marks. Another is the inherent unreliability of complainers who also may represent outliers among guests. And still another is the rankings aren’t valid interpersonal comparisons. The guest doing a ranking may simply not think about hotels the same way that you do. And rankings are often simply not reasonable reflections of what a hotel is trying to accomplish (knocking down the Ritz-Carlton Central Park because its room service breakfast is expensive, for instance.. of course it is).

Into the space there are several new review sites, few of which have gained much traction. Hotels have tried to compete as well (remember, they really want you to book direct) with their own reviews. And they can even verify that a guest writing a review has really stayed at a hotel!

The competition here is far from over. But Kayak certainly will face pressure because while they can find you lots of different hotels (compared to chain sites which generally offer their brand only), it doesn’t do a good job at guiding you to book the room that’s most right for you.

That’s the big thing that was lost when mass travel became substantially an online booking phenomena — the loss of human agents who could understand your preferences, combine those with personal experience, and make recommendations that were in theory tied to the individual customer.

That’s also the future once again, even in the online booking space as sites race to get better at doing more than just returning results in a city and letting you sort by price or distance or ‘number of stars.’

No one is very good at it yet. Orbitz fumbled when they started returning higher priced hotels to Mac users.. when all they were doing was responding to their data which suggested that Mac users tended to book higher priced hotels than PC users, and so wanted to give those customers tailored results that were more likely to lead to a sale. They weren’t trying to ‘charge those customers more.’ They just didn’t want the customers not to find what they were after and go somewhere else to book instead.

There’s still a lot of room for work to be done, and contra conventional wisdom the future year is yet to be written. Let alone the future in mobile where last minute bookings are increasingly common, and customized advice won’t just be based on other guests’ experiences (social) but on real-time geolocation data.

Just yesterday I was musing that United.com no longer showed ‘phantom availability’ for Lufthansa, and I needed to write a blog post about that.

But Lucky beat me to the punch.

United and also at one time Aeroplan would show Lufthansa first class award space more than two weeks out, when Lufthansa seems not to release those seats to their partners more than two weeks out. While the seats would show up when doing a search online, you couldn’t actually book the seats and would get an error instead if you tried to do so.

My working theory had been that the seats were available to Lufthansa’s own Miles & More members and that there was something wrong with the ‘point of sale’ settings when searching for these awards — United was displaying availability as though it was being searched by Lufthansa itself. But when it went to actually make a reservation, the correct point of sale was used and it would discover no seats available after all.

I never tested the theory, in large part because Miles & More requires you to have some miles in your account to do that search unless you are a member of their kid’s club. Which I am (!). But I had lost the PIN for my account. And by the time I found it again, I had lost interest in the question and never followed up. Shame on me.

And as Lucky observes, it’s now a moot issue because United.com no longer seems to show Lufthansa first class award seats more than two weeks out.

Except he stumbles upon an anomaly — Lufthansa first class award seats available hours beyond 14 days out which are actually available and show up on the ANA Mileage Club website… but not the United website.

As he points out, this is potentially a big deal because there’s a several hour delay in United seeing the seats, during which time someone else could grab them. And since subscription service Expertflyer, which can send you email alerts when availability opens up, is scraping the United website it will send you those alerts hours after the seats become available as well.

When I tried to replicate Lucky’s finding about June 2nd that Detroit-Frankfurt was available on the ANA website but not the United website, I found the seats via ANA. But United wouldn’t even show the existence of the Detroit-Frankfurt (or Frankfurt-Detroit) non-stop at all. Or the Toronto flight, which had space available. Both flights showed up correctly on the Aeroplan website.

My working theory, to be verified in the coming days, is that United’s fix involves a ‘hack’ they way that much of United’s SHARES implementation involves workarounds rather than actual fixes of problems. I’m not sure they’ve actualy fixed things, they may just suppress results. In other words, their system might still ‘see’ availability incorrectly, but they won’t show it until a certain amount of time to departure. And Lufthansa may actually be releasing it to them earlier than that.

Two years ago I stumbled onto a Continental issue where an international business class award where a domestic U.S. segment was booked in coach on a United three-class plane would price as a first class award. I reported it and learned that they had built a workaround to handle pricing for United three-class domestic flights and they did it wrong. In short order the programming glitch was fixed (ah, the good old days).

There have been other hacks and problems with United’s passenger service system, such as the way it processes upgrades (triggered by check-ins of other passengers rather than real-time). And they can’t always get their system to pass ticket numbers properly to partners so award ticket reservations sometimes just cancel. This is especially a problem with Asiana but has also been a problem with award flights on Singapore.

Even when United improves its IT systems, they still seem to get it backwards.

One of my favorite posts last year was Why Taxis Suck and What You Can Do About It.

With protection from competition and fixed pricing, cabs have little incentive to go beyond bare minimum regulatory standards for maintenance. Drivers may not know where they’re going, and in my city usually don’t take electronic forms of payment. Competition solves these things but local taxi regulators are the archetypical example of regulatory capture, protecting incumbents from competition rather than protecting the public.

New York, like many other cities, tried to crack down on Uber as a competitive threat to incumbent interests. But like in so many other cities, customers who love the on-demand car service and taxi app spoke out loudly enough that it was too much of a threat to politicians and so the regulators more or less relented. It seemed like consumers scored a win in Washington DC as well. But once the spotlight dissipated, things changed again.

DC’s Taxi Commission has long been in the pocket of incumbent taxi interests. Top politicos were sentenced last year after an FBI undercover operation.

There’s big money in protecting big cab operators from competition, and it seems that DC hasn’t given up in its fight against Uber.

With regulations passed last week, UberTaxi will disappear on June 1. Additionally, the next set of regulations, just 3 weeks from passage, will ban fuel efficient vehicles from UberBlack, require Uber to hand over massive amounts of data on your rides, and require Uber to jump over regulatory hurdles every year just to exist. These regulations are unprecedented and far more restrictive than Uber has seen in any of the 30 cities that we operate in.

Apparently the DC Taxi Commission is forbidding digital payments to taxis. They propose requiring annual approval of the Uber’s iPhone app (yes, the taxi commission intends to channel Steve Jobs). And perhaps most bizarrely, they are banning Uber from providing access to fuel efficient vehicles.

That’s right — they aren’t mandating the use of fuel efficient vehicles, as some governments are wont to do. They’re actually banning them.

Hopefully public attention hasn’t moved on too much from this issue.

News and Notes from Around the Interweb:

• And your reward for 10 bus trips is… another bus trip: Southwest extends double points for another month
  
• Those friendly Canadians offer up a small bonus: Aeroplan is offering 1000 bonus miles for activity with many of their partners through August 31
  
• It’s no Grand Slam, but.. US Airways is offering a 50% bonus on hotel stays and car rentals credited to the Dividend Miles program (points transfers into Dividend Miles don’t count). Registration required.
  
• I Still Like Southwest’s Original Secretary’s Program Better: United’s new small business program lets you accrue miles in a separate account for the business for a variety of activities and should even offer the ability to transfer those miles to a personal account. Most airlines offer small business programs, usually those earn ‘credits’ rather than miles that can be redeemed for flights, upgrades, drinks, etc. United’s post-merger rollout has been a long time in coming.

Lucky notes that JetBlue has increased their ticket change fees — but will waive those fees for elites (cough, Mosaic is their Animal Farm elite program).

And those fees will vary based on how far in advance you book your tickets and on the price of those tickets.

Change/Cancel Fee Amounts – Effective May 17, 2013
Changes and cancellations made 60 days or more prior to departure date:

$75 per person fee
Changes and cancellations made within 60 days of departure date:

$75 per person fee for fares under $100
$100 per person fee for fares between $100 – $149
$150 per person fee for fares $150 or more
*Note: Customers who booked their reservation prior to May 17, 2013 will be allowed one change or cancellation at the previous fee structure – $100/per person or $50/per person for fares under $100.

The structure actually does make some sense, but I bristle at how Lucky thinks about change fees.

As a consumer this has been extremely aggravating to watch, because change fees in no way reflect the cost of providing that service. We might not like paying for checked bags, but at the end of the day we can rationalize the fact that checking bags costs the airline money.

I actually think the exact opposite.

We pay for checked bags in large measure because of the 7.5% federal excise tax on airline tickets. Anything you can get out from under the ‘ticket price’ isn’t subject to that tax.

There are many ancillary fees that are about pricing a limited resource that used to be given away for free. There are only so many exit row seats on a plane, so charging for those since people like them better makes sense.

But offering checked luggage comes with substantial fixed costs but very low marginal costs (some incremental fuel due to weight, but the number of baggage handlers don’t change much based on how many bags you check).

Checked bags ‘cost the airline money’ but don’t really at the margin which is why I’d expect (absent the tax distortion) checked bags to be more likely bundled into ticket price than most other things in the future. And of course American bundles them with their Choice fares now, and many airlines bundle them with co-branded credit card signups.

Meanwhile change fees do reflect ‘a cost of providing that service’ at least as travel dates approach — which is why JetBlue’s fee structure makes so much sense.

If I book a ticket 11 months out, and change it, the airline loses more or less nothing but I have a hefty change fee. They still have every opportunity to re-sell the seat.

But if I cancel my reservation the day of travel that’s a seat which may go empty, that the airline could otherwise have sold sometime between when I made the purchase 11 months earlier and the date of travel. A high change fee certainly seems appropriate (the ‘cost of providing the service’ is the real possibility of ‘revenue foregone’).

Now I remember when change fees were $25, $50, and then $75. With that frame, $150 seemed ridiculous and $200 ludicrous.

On the other hand I’ve often wondered why restricted, non-refundable airline tickets are changeable at all? I’ve certainly seen international fares published that allow no changes, and that cancelling offers no residual value. We buy plenty of things that we cannot return, that are use it or lose it.

Those often are at least transferable, and for which there’s at least a grey market in resale, while ‘security’ rules only allow us to travel under our own names and so tickets become non-transferable.

Ironically, when JetBlue first launched their travel credits were 100% transferrable. The change fee was $25, so if you cancelled a ticket you lost only $25 in value and anyone could use that remaining value. (A dozen years ago as well, SAS tickets were transferrable for a $25 fee — you could change the name on a ticket to someone else’s — provided that you signed a form that the tickets were for personal rather than business use.)

At a US major airline standard of $200 change fees on domestic tickets, that might as well make many tickets totally non-changeable and thus just throwaways if unused for me, at least when I’m buying one-way tickets.

If there was an economic reason for airlines to offer non-refundable tickets with residual value, the $200 change fee does away with a good bit of that. There might be some point at which the change fee is so high that it hurts the airline.

Of course the existence of residual value could itself have been a relic, and we’re entering a future where restricted tickets have no residual value at all.

On Wednesday I wrote about improvements to hotel booking site PointsHound — that by this coming week there would be about 1000 major chain hotels that you could book on the site and still earn elite status credit and in-hotel benefits, while earning a rebate in the form of a fairly substantial number of frequent flyer miles.

I offered up my referral link for the site. Everyone being referred by an existing member gets 250 bonus miles with their first booking, and the referrer gets 250 miles as well.

But I didn’t even mention the bonus miles that folks would get by using the link, that’s not why I suggested it. It’s that they gave me a link that would allow new members to earn more miles during their first 60 days (and with 6 nights booked during that time keep the higher level of earning). In other words, because using my link offered better mileage earning that signing up directly.

And 250 miles is fairly de minimus in the context of miles earned for bookings through the site which are often in the thousands.

Normally I’m a fairly good judge of the reaction that my blog posts will engender. It’s usually clear when a post will make people excited, or angry, and whether comments will ensue or not. If I want to get a good controversy going I can always just write about babies on planes….

Well this one took me by surprise. A number of folks were frustrated or angry that I’d offer up my referral link for the site, as though I was hoping that folks would use the link so I’d “get paid” in the form of 250 miles.

Frankly, I have millions of frequent flyer miles and the 250 miles from each first use wasn’t much of a motivator for me.

Ironically, in fact, I even asked PointsHound if there was a way that readers using the link could just get all of the miles for using the link? I didn’t wait to hear back in posting because I was excited by the new features and assumed that the referral bonuses were hard coded and not easily changed. I didn’t expect to be able to get this done.

Well, as one commenter notes, the change was done before I even knew it — they received the following email,

“Also, as a thank you for signing up, you’ll receive an ADDTIONAL 500 miles with your first booking, so start shopping.”

“We will also be upgrading your account to Level 2 status, which will happen with in the next 24 hours. You’ll receive an email from us once completed!”

Hopefully the incremental miles will be useful. I am trying my best, each and every day, to bring you the best mileage and other offers I possibly can. In the coming days and weeks I have a couple of giveaways coming as well, because when merchants I like offer things I try to get them for blog readers instead of taking them on. So a few high-value items in the works. Stay tuned!

Airlines have tried all manner of boarding processes for years in an attempt to load the plane more quickly. Turnaround time for an aircraft matters — to remain on schedule (delays are costly in terms of labor and misconnects), for customer satisfaction, to avoid losing air traffic control slots (delays can cascade and increasing costs can themselves increase costs).

And what seems to work for awhile no longer works — due to customer complacency, due to changing behaviors, and also varies with how full an aircraft is.

Checked bag fees mean more bags are brought onboard where possible. Although whereas airlines used to allow two carryon bags US government regulations now only allow one (and a ‘personal item’) as a way of speeding up a still-slow security process. The net effect of more bags is driven largely by full aircraft. And full aircraft means lots of time stowing bags, not enough room for all the bags, time spent searching out overhead space, and time spent gate checking luggage.

There are things that can be done to speed up boarding and deplaning. Using more than one jetbridge (or using forward and rear stairs) is one.

American thinks they’ve found another in allowing people without carryons to board in “zone 2.” That way more people are on the aircraft and other passengers working out where to put their rollaboards doesn’t delay those passengers without from getting situated.

I saw a variant on the theme about six weeks back in San Diego when gate agents announced that anyone choosing to gate check a bag (free) would be rewarded with early boarding. I was vexed at the time — after all, if you don’t have bags to stow why on earth would you need to board early?

The benefit, to me, of early boarding is having space for your carryon and having it near your seat even. But with no carryon the last thing I would want to do is be on the aircraft longer.

Although I suppose since it’s something people “get to do” they will want to do it. And somehow here’s a desire to “get situated” as though it takes a long time sans carry on to put a small bag underneath the seat and buckle up. (I get that families with small children may be another matter, but with most carriers they are already given the opportunity to board early… and what some families try to pass off as ‘small children’ for the privilege is often extreme to say the least — as well as the number of family members that try to board with one 13 year old.)

Do I think this new privilege will be revolutionary? Absolutely not. Will it make some difference to boarding time at the margin? Perhaps. Until it doesn’t any longer. And only in those instances where boarding order is clearly communicated and enforced. I suspect boarding might also be sped up by an airline that decided to keep the boarding gate clear of those not yet “on deck” to have their rows called….

With some of the very best offers for the most lucrative credit cards being business cards (see The 5 Best Small Business Credit Card Offers and 5 Most Lucrative Credit Card Offers Right Now, and 5 Most Rewarding Credit Cards for Your Spending Every Day), it’s worth looking at what the cards are good for, what they aren’t good for, and who can get them.

The Best Current Business Credit Card Offers

The very best current offers for small business cards are:

• Ink Bold® Business Card 50,000 points after $5000 spend within 3 months
  
• Ink Plus® Business Card 50,000 points after $5000 spend within 3 months
  
• The Business Gold Rewards Card® from American Express OPEN 75,000 points after $10,000 spend within 4 months.

The American Express Business Gold Rewards card has a great signup bonus, Membership Rewards points transfer to airline frequent flyer programs in all three alliances.

The Ink cards, though, aren’t just great bonuses (Chase Ultimate Rewards points transfer to United, British Airways, Korean, Southwest, and hotel programs like Hyatt, Marriott, and Priority Club) but are also great cards for spending — no foreign currency transaction fees, double points on hotels, and quintuple points on telecommunications (phone, internet, television) and office supply store purchases.

Why Small Business Credit Cards are Great for Spending

Business cards don’t show up on your credit report. Banks do pull your personal credit when they are deciding whether or not to approve you for the card, but after that the card doesn’t get listed.

That’s useful because one of the major components of your credit score is your credit utilization . That’s not about whether you pay off your cards each month, that’s about how much of your available credit you are using at a given time.

Your cards report your balances each month — not your unpaid balances, not overdue balances, but how much you’re carrying on the card on a given day (and paying off the card before the end of the billing cycle may not help, since they may report mid-cycle).

About 30% of your score stems from how much of your credit you use. If you’re using $2000 out of $4000 available credit, you’re using 50%. You may pay off your bill each month but you still look risky, you’re not being afforded lots of credit that you’re responsible with in the eyes of your credit score. If you’re using $2000 out of $20,000 available credit, that’s only 10% and looks much better — even though you are spending the same amount on your cards each month. Which is why applying for more cards can actually improve your score, despite that conventional wisdom that it’s bad for your credit.

In addition to boosting available credit (increasing the denominator), you can improve your score by reducing the amount of that credit you are using at any point in time (reducing the numerator). By putting your spending on a small business card, the balance of which doesn’t get reported, you reduce the amount of credit that it appears you’re using. Which is good for your score.

How You Can Get a Small Business Credit Card

I find it very useful to have a business credit card, and have for a long time – I got my first one about a decade ago, giving my social security number as a business tax ID (for sole proprietorships American Express lets you leave the business tax ID box blank).

Before I had my award booking business I would use my social security number. Most of the time back then (much more so than now) I would be approved instantly, or at least automatically.

Even having $0 in business income was often fine, it’s good to separate out business and personal expenses from the very beginning when starting to look out for business opportunities.

I’ve been a huge proponent of diversifying income — sure, I have a job, but I also blog and book awards and my writing earns income not just here but on websites like Conde’ Nast Traveler‘s. In the past I’ve also done fundraising consulting. And I own a rental property, as well.

It’s much easier to deduct the expenses for a business when the financial transactions for that business are kept separate from personal finances. So just as it’s useful to have a business bank account, it’s useful to have a business credit card. And that’s true even — and especially — before you have any revenue for the business. Keeping things separate from the start is a great reason to have a business credit card. Answer questions on the application truthfully. If you don’t have any business income, then list zero. That’s fine, you can get approved on the basis of your personal (non-business) income. And if you’re not approved automatically, you can still explain that you haven’t earned income from the business yet, you’re just now setting it up.

Different Perks and More Spending Bonuses

While I love my Chase Sapphire Preferred card — most of my expenses fall into the travel and dining categories which that card bonuses — I want to earn the greatest rewards for my spending. Earning 5 points per dollar with the Ink cards on telecommunications and office supplies are huge, especially with the wide variety of items you can buy at office supply stores (fortunately there’s a Staples just a couple of blocks from my home.

Are Business Cards for Business Expenses Only?

Business cards often carry the admonition that you agree when you apply you will only put business-related expenses on the card. Business cards do not carry the same consumer protections as personal credit cards, and it’s important for banks to draw the distinction and be able to say they’ve advised consumers and that consumers even agreed. That’s for their legal protection. While no bank has ever questioned the charges I’ve made on my cards, they’ve taken steps on their end that are necessary to distinguish business cards from personal cards for regulatory purposes.

An Opportunity to Get More and Different Cards

I have a wallet full of cards. The banks expect that. Speaking recently with one credit card executive, he intimated that he does as well — and that they give you more than one of his bank’s cards because they know you want more than one card and would rather that you have multiples of theirs than one of theirs and other banks’ cards as well.

The cards you’re able to get are dependent on both your overall credit and your income, some banks have limits on the number of cards they will issue to you. There are some reports of American Express giving up to four personal cards, for instance. But business cards are often not a part of that limit.

(Note that some though not all of the cards above include my referral link, I do receive credit if you’re approved for the card using it, I offer it because it’s the best current offer. The opinions, analyses, and evaluations here are mine. The content is not provided or commissioned by the American Express or any other company. They have not reviewed, approved or endorsed it.)

Back in October I covered the launch of hotel booking site PointsHound. They were giving out free miles for joining, which was cool. But at the time I said that I probably wouldn’t use the site. That’s all changing.

PointsHound is a site that gives you miles – often quite a lot of miles – for your hotel bookings. Here’s what I explained at the time:

[W]hile many websites like TopCashBack and eBates will offer cash back for the hotel bookings you make through the hotel’s own website, PointsHound rebates you in the form of miles and has you book through their own system.

The downside to making bookings through third party websites is that some chains do not allow accrual of elite stays and nights for those reservations, some do not allow points-earning, and still some do not even offer elite status recognition. That’s why I’ll almost never make hotel bookings through Expedia or Orbitz, for instance. Still, the rebate value here (paid out in miles) looks reasonable overall.

I do like going through a website that gives you a rebate for your bookings. But I do not like giving up elite benefits, or credit towards renewing my status. So I had been passing on PointsHound, even though they’ve been giving out a ton of miles.

Recently that’s changed — for a few months they’ve offered a handful of hotels in a dozen markets that earn a rebate and still qualify for elite status and benefits.

They called the program ‘double dip’ but clearly that idea is pretty Hilton HHonors-specific in the hotel space (Hilton for years has let you earn both miles and points on your hotel stays rather than making you choose one or the other).

So on Monday when they launch the program with about 1000 hotels across the Hyatt, Hilton, Marriott, Starwood, and Priority Club chains it will be branded “Double Up” instead.

So for those ~ 1000 hotels, you can earn a generous rebate in the form of miles without giving up status credits and benefits.

Now, it still pays to check websites like TopCashBack and decide whether the cash rebate they’ll give you is worth more than the miles you’ll get from PointsHound. (TopCashBack and similar sites — unlike Expedia and Orbitz — send you to the hotel’s own website to make your booking so those reservations are eligible for elite status credits and recognition.)

But for chains other than Priority Club, the mileage offers from PointsHound are frequently better.

Their mileage-earning partners currently are:

They have three mileage-earning levels based on how many times you book with them. They’ve given me a referral link, though, that will start you off at level 2 which seems to earn about 50% more miles on average. If you sign up through the link it will take, I’m told, about 24-48 hours for your ‘level 2 status’ to be reflected.

Here are their levels and the earn ranges for each:

It pays to compare rates — there seeem to be outliers where the site winds up more expensive than booking directly, but that hasn’t been frequent in the searches I’ve done. Always check prices against other sources.

For someone like me, this program really hits the spot. I care about re-upping my elite status. I care about the benefits of that status. And I’ve hated forgoing a rebate, for instance, when booking rooms with Hyatt. 1000 hotels is a good start but not ubiquitous enough, but getting perhaps the equivalent of a 12% rebate in the form of miles is pretty good compared to what I was getting before (no rebate) on those bookings where PointsHound has a hotel. Good news all around.

Do note, though that not all of their deals earn status and elite benefits — their prepaid rates do not. So look for their Double Up rates only if your preferences are like mine. For hotels I’m booking at chains where I care about status and the hotel isn’t listed with this marker I will continue to book elsewhere. (But for one-off stays, the rebated points may be worth more than what I’d earn through the chain anyway.)

Additional disclosure: Not only do you get level 2 status but I understand that I may get some miles for referring you if you use my link when signing up for the site and make bookings. So it’s win-win. Furthermore, when I was perusing their list of key players I noted that I do know one of the site’s investors. He has never mentioned this investment to me.

News and Notes from Around the Interweb:

• Delta’s Lawyers Move to South America? AviancaTaca LifeMiles makes some mostly minor tweaks to their award chart. I don’t like unannounced changes. Some programs are more trustworthy than others, and the ability to make changes at will is why I don’t like keeping huge balances (sometimes unavoidable) and why I don’t generally buy miles that aren’t for immediate use.

• Let’s Spend All The Loot Before The Cops Catch Us: The FAA awarded bonuses to a substantial portion of its workforce right before making sequester-imposed cuts, despite a directive from the Department of Transportation not to do so. (HT: Alan H.)

• 90% of Expensive is Still Expensive: Reader S.B reminds that the British Airways Visa still offers 10% off on paid BA tickets. At one point the benefit was set to expire in December 2012, but it was extended.

• On a scale of 1… to 5000! Last weekend I stayed at the Cheyenne Mountain Resort in Colorado Springs. The views were spectacular, the staff friendly, the food not very good. My only real complaint though was that the ceilings didn’t dampen noise at all, and I could hear every footstep taken by my upstairs neighbors. Every. Foot. Step. Meanwhile, Do it for the Points was staying at the nearby Doubletree and gives it five stars. I’ll have to keep that in mind.

Key Link: The Business Gold Rewards Card® from American Express OPEN

75,000 Membership Rewards Point Signup Bonus after $10,000 Spend Within Four Months

Last week the internet went wild with a 75,000 point offer for the American Express Business Gold Rewards card. I posted it, and 19 hours later the offer was gone. A few times in the past I’ve seen 75,000 point offers, but never with just $5000 minimum spending required.

I try to track the popularity of links that I post, so sometimes I use a shortened link and can see how any times it gets clicked on. And I’ve never seen a link clicked on as many times as that deal. Because it was one of the two best deals in the frequent flyer space so far this year, I think, and the best in three months.

Turns out though that I’m not sure American Express meant to offer it. They quickly pulled it. This is a card after all that for most the of the past year hasn’t had any signup bonus. And that when I grabbed the card for myself had a 50,000 point signup bonus after$10,000 in spend, and I considered it a really good deal.

This morning I got a tweet from @sannitaliu that for three days only they’re doing 75,000 points again after $10,000 in minimum spending. It’s apparently valid until May 17 only. (Note: this is not my referral link, but it is the best current offer for the card.)

There’s a hefty minimum spend requirement of $10,000 although you have four months to meet it and there are plenty of ways these days to generate spend that it’s entirely doable for many, much more so than it used to be.

Here’s what American Express says about the card.

• Earn 75,000 Membership Rewards® points after you spend $10,000 in purchases on the Card in the first 3 months of Card membership†.
• Earn points even faster to get more rewards for your business.
• 3X points on airfare purchased from airlines. 2X points at US gas stations.
• Up to $100,000 in each category per year, then 1 point.
• Terms and limitations apply.
• Reduce travel costs, show appreciation for employees and clients, and offset everyday expenses by using points to get something back and grow your business.
• $0 introductory annual fee for the first year, then $175.
• †Apply online to qualify for this offer. See offer terms for details.”

This is a really strong offer, Membership Rewards points are my third favorite currency behind Chase Ultimate Rewards and Starwood Preferred Guest. This is a good card for the first year with the $0 annual fee, but whether it makes sense to keep after that first year likely depends on how much advertising, gas, and shipping spend you do since those are fairly unique bonused categories.

In March I explained how to make the most out of American Express Membership Rewards points. Bottom line is that 75,000 points is a really great haul.

Note that if you don’t keep the card past the first year you will want to either transfer your points out before closing the card, or have another Membership Rewards-earning card in order to keep those points active.

The card offer is specifically not available for anyone who has had an American Express business card earning Membership Rewards points within the past year. Personal cards are fine, a similar card more than a year ago appears to be fine, but if you had this or a similar card in the past 12 months the offer is not for you.

If you don’t want to try to meet $10,000 in minimum spend, consider the Ink Bold® Business Card and Ink Plus® Business Card which each offer 50,000 Chase Ultimate Rewards points after $5000 in minimum spend. That’s certainly a stronger return per dollar of spend, and for a currency that I like even more than Membership Rewards points.

(Note that the Chase applications above use my referral links, while the American Express card is not a referral link. In both cases the links are to the best current offers. The opinions, analyses, and evaluations here are mine. The content is not provided or commissioned by the American Express or any other company. They have not reviewed, approved or endorsed it.)