View from the Wing

A couple of Flyertalk members met with management from Northwest Airlines and the Worldperks program and filed this report.

An interesting read, though I’ll nitpick at a couple of explanations Northwest offers for decisions.

In keeping with its commitment to customer loyalty, WorldPerks currently has no plans to participate in the American Express Membership Rewards program. Northwest see this as simply: “Why should someone who has no loyalty to Northwest Airlines receive miles for the points they have in another loyalty program, and redeem them for awards, thus reducing the number of awards for loyal WorldPerks members?

If that’s the case, how come I can transfer points to Northwest from Diners Club, Starwood, Goldpoints, etc. etc.? And if the issue is sharing a fixed pie of award seats with folks other than Worldperks members, how come they allow redemption by members of Skyteam and other partners? (In the latter case, sure, Northwest members also access award seats on these partners to be sure.)

Northwest has also made a conscious decision not to “give away” WorldClub membership due to elite status in order to prevent overcrowding of the clubs and dissatisfaction of Club members

Then how come they let me in with my Amex Platinum card?

But other than some minor snarkiness on my part, I’d suggest giving the piece a read.

Frontier Airlines has launched a new feature for its frequent flyer program allowing elite members to redeem points for merchandise: the More Store.

Frontier Ascent and Summit Early Returns members (those who fly at least 15,000 miles a year) will be able to trade miles for jewelry, rounds of golf, restaurant meals, luggage, sporting events, overnights at the Brown Palace and tickets by visiting www.frontiermorestore.com

…

The Web site also has an online auction feature, with items including a new Mercedes M- Class SUV with a starting bid of 10,000 miles.



More Store perks partners include restaurants such as Jax Fish House, Tamayo, Zengo, Panzano, Lola, Aix, Luca D’Italia, The Palm, Rioja and Opus.



Frontier frequent fliers can trade miles for rounds of golf at Bear Dance, Green Valley Ranch, The Raven, Pelican Lakes and Arrowhead, or get tickets to the Rockies, Crush, Nuggets, Avalanche, House of Blues Concerts or the Grand Prix.

Andrew Hudson, a senior-level marketing executive with Frontier, told Inside Flyer magazine (subscription required)

Our loyalty program did not stack up against other programs. It was not at the level it should be.

It isn’t often that a marketing executive is so candid. Perhaps they can be now, because from the little browsing I’ve done of their offerings it looks very impressive.

Most miles-for-merchandise offers are fairly low end or represent poor value for points. Here there are some reasonably priced offerings (such as a round of golf for 6000 miles) and a whole bunch of aspirational awards.

While much has been made of the Mercedes on auction, ’starting at’ 10,000 miles (no one expected it to go for that!), I’m most impressed by the depth and quality of other things on auction, such as a Denver’s hotel’s presidential suite along with meal voucher. Frequent flyer programs are at their best when they offer otherwise-unattainable experiences. Hotel programs won’t generally allow members to access a presidential suite, but the More Store is auctioning one at the Brown Palace in Denver. It remains to be seen how competitive the final pricing is at the end of an auction, but kudos for making such things available.

The cover story of the July, 2005 Inside Flyer is on airlines spinning off their frequent flyer programs in public offerings.

David Rowell thinks United could be worth $15 billion. Randy Petersen says “greater than $2.5 billion.”

According to the piece, airlines sell $3 billion worth of miles annually. United’s spinoff of Mileage Plus into a wholely-owned subsidiary in 2002 was a $1.4 billion transaction. Mileage is clearly a big business:

In 2003, ULS accounted for 5 percent of UAL’s 2003 revenues. In 2004, United recognized more than $400 million in revenues related to ULS, which would not reflect the entire business revenue of ULS for that year. In 2000, revenue for third-party mileage sales reached $220 million during the first six months alone.



But American AAdvantage is clearly the king of frequent flyer programs, with annual revenue related to third-party sales of miles exceeding $1 billion annually.

Airlines sell miles, and buy seats redeemed with those miles (or merchandise, etc.) at a discount, earning money on the spread.

Randy thinks a spinoff would make miles safer, since a loyalty program could simply buy seats from another carrier if the one to which they’re linked goes under. And since the largest programs redeem millions of free seats each year, they should have the buying clout to negotiate sufficiently discounted tickets (likely maintaining heavy restrictions) that they could remain profitable.

Through the end of the year, American is offer AAdvantage members the opportunity to reactivate miles that expired after December 30, 2002.

There’s a fee — $50 for every 5000 miles plus $30 for ‘processing’. So really you’re just being allowed to purchase miles at a discount, one cent per mile, but that’s actually a pretty good value.

(Hat tip to the MilesLink newsletter.)

Jameson Inns, which owns 123 economy properties in 13 states, is offering stock as a frequent guest perk. Three million shares have been registered with the SEC for this purpose.

Guests who enroll in the program would have 10 percent of their room charges credited toward the purchase of Jameson stock, now trading near $2.50 a share.



Shares will be provided through a designated broker or the company, based on the average closing price for the last five trading days of each month. Customers won’t pay commissions on shares they receive, but will pay fees on shares they sell.

(Hat tip to the MilesLink newsletter.)

Hat tip to Free Frequent Flyer Miles, NetBank has improved its offer for United, Delta, and America West miles. If I recall correctly, the maximum points earned used to be 7000 and is now 9000.

Priority Club points are also still available with no change in offer.

NetBank offers a decent free checking account, I actually have one myself, but beware of odd fees triggered by inactivity over 3 months and closing the account within six months.

My main checking account remains BankDirect, which has helped me to earn over 70,000 American Airlines miles in the past two years. It has much richer offers than NetBank, but only makes sense for someone who can maintain a minimum checking account balance of $2500.

There’s a 1000 mile bonus for being referred by an existing accountholder, I’m happy to refer you just email me (I get an extra 1000 miles as well).

When distribution of funds for homeland security is done politically, as pork (the system we have now, more or less), you get farces like this one.

Kentucky’s large rural population prompted program coordinators to center this exercise around agriculture. Likewise, he said since Kentucky is one of the nation’s top five goat-producing states, setting the attack at a goat show seemed plausible.



The goats “have been infected with a bio-agent. … Then, the infected goats are at the show and you have people come and look at the goats and pet the goats and then they go home,” Cline said, summarizing the day’s scenario.



“We try to focus on what really matters to Kentucky,” he said, adding, “this is a perfect way to do it.”

Effective yesterday, Alaska and KLM have discontinued their partnership.

This was revealed on Flyertalk. I can’t find any mention of the change on the Alaska Air website, all references to the KLM partnership are just gone — down the memory hole — very Orwell-esque.

Award tickets that have already been issued are valid for travel for one year from date of issue or June 6, 2006, whichever comes first.

Not only was the change done without warning, but members haven’t been informed.

The D.O.C. Optics eyecare chain is offering Northwest miles for a variety of services. It’s been 1000 miles for purchases of glasses, and now 20,000 miles for laser eye surgery in suburban Detroit. (Hat tip to Today in the Sky.)

This has got to be up there with the 2500 Alaska mile guarantee from the Danny Schurman Home Selling System.

You can earn triple Cathay Pacific AsiaMiles (August 1 - September 30) when flying from LA or San Francisco to Hong Kong on first, business, or qualifying (Y, B, H, K, L, M, V) coach fares.

You could also choose to earn double American AAdvantage miles through August 31 on these flights, but only when flying first or business class (”I” business fares are not eligible for the AA offer).

Personally I’d opt for the AsiaMiles, both because coach fares are eligible and because AsiaMiles are hugely valuable — they allow upgrade redemption on Cathay, American, and British Airways and 60,000 AsiaMiles gets you a business class award on BA from the US East Coast to most destinations in Europe (it would take 100,000 BA miles).

David Rowell looks at Air Canada’s successful public offering of its Aeroplan program, and wonders why United hasn’t gone public with Mileage Plus?

Rowell thinks Mileage Plus could be worth $15 billion.

That seems a little high to me, I’m also not sure that imputing similar per-member value makes sense. My hunch is that US consumers participate in more frequent flyer programs than Canadian consumers do, so Mileage Plus while valuable may occupy less mindspace than Aeroplan.

I’d personally believe a $5 billion market value estimate rather than $15 billion, but what do I know? Either way, it doesn’t change David’s central point that United has a hugely valuable hiddle asset.

Contra David, who believes United should sell a large stake in its frequent flyer program to exit bankruptcy and pay back creditors and the government for its bailouts, United’s bankruptcy is likely the reason that Mileage Plus has not yet been spun off. Air Canada was ready to spin off Aeroplan but put those plans on hold when it entered bankruptcy.

The questionable status of the attached airline will likely drag down the value of its frequent flyer program in any kind of offering. Once United exits bankruptcy, I would anticipate an IPO provided that market conditions remain stable.

While it may even make sense to include a frequent flyer program IPO as part of a plan for continuing operations submitted to the bankruptcy court, I doubt it makes sense to put this first and use it to fund a bankruptcy exit.

Still, the value of this hidden asset shouldn’t be ignored when valuing the company and planning for its repayment obligations. Here I think David is dead-on correct.

Wednesday, June 15

10:25 am Departure Melbourne (MEL)
Qantas Flight 93, MEL-LAX
First Class Seats 2E, 2F

We arrived without further incident about 8:20am and walked right up to the 2 dedicated Qantas checkin counters for First Class on MEL-LAX. No wait. Bags were tagged to Seattle and boarding passes were issued all the way there – even though LAX-SEA was on a separate e-ticket purchased from Alaska directly. I simply showed my itinerary to the CSR and she didn’t have any difficulties.

There was a short line for passport control, and then we walked through duty free. Would they let me bring in Aussie beef jerky into the states? It was on sale at duty free, but when I arrived at SYD there was a sign specifically saying that beef jerky was prohibited. I guess that must be a common item? :confused: I skip the duty free, even though there were the largest liquor bottles I’d ever seen on offer.

We went through security with no line and then over to the QF club downstairs. We checked in at the desk and were sent down the hall on the left to the F side, which had showers, 4 computers with internet (a tad slow) and printers. I found the club lihht and airy for a downstairs lounge with no views. The food selection wasn’t impressive, just some pastries and pretzel-type snacks, perhaps it was because of the early hour. The coffee machine made a decent cappuccino, though.

We boarded 20 minutes late due to late arriving aircraft and were in the air at 11am. Captain said we’d make up the time.

Once at our seats, FA came around for drink orders and brought nuts and olives (the latter distributed with a separate plate for pits). Amenity kits and PJs were distributed on the ground. I changed in the lavatory, which is nice as it’s larger than the standard lav not to mention having a window!

After takeoff, menus were presented…
Read the rest of this entry »

Air Canada successfully sold a stake in its frequent flyer program today, and based on the price paid for a 12.5% stake Aeroplan has a market value of CAD$2 billion.

Monday, June 13

Westin Sydney

Westin is built around an old Post Office (the Intercontinental was built on top of the old Treasury building).

We checked in about 1pm and were given a ‘deluxe room’, number 1806. The door has electronically-controlled signs for do not disturb and service room – you flip a switch inside the room by the door, and the appropriate note lights up outside.

Our room certainly had a fantastic bathroom. It wasn’t the Nui, I couldn’t feed the fish from my tub, but it had a large glass window between the bathroom and the room (with an electric-controlled screen between the two) and separate toilet and shower rooms housed in frosted glass. Here’s the sink. The shower had two heads – one directly above from the ceiling, and one coming out of the wall as is standard, the latter being removeable/moveable.

Here’s the entryway to the room, the room as seen from the bathroom, and a shot of the room itself.

The room had a power converter by the desk, not just the standard ‘shaver only’ 115V outlet in the bathroom, although it felt a bit light and I doubt it had any surge protection capabilities (not sure I’d want to plug my laptop in, for instance).

Though Sydney is in general pretty strict about not permitting smoking in most public spaces, smoking was totally permitted in the lounge. I never asked why, but wonder if it might be that it’s considered technically ‘outside’ and just covered by a very high skylight?

Champagne was delivered to our room shortly after arrival. I had only made the booking the evening before – I had a place to stay for free but decided it would be nice to spend our last night in Sydney in the city. Still, they managed to put that small gesture together quickly. We’d sure racked up a bunch of complimentary bottles by this point.
This hotel had one of the best room service menus I’ve seen, and execution was excellent. I like that in Australian hotels, at least at the Intercontinental and the Westin Melbourne, there isn’t a percentage added on to room service orders – just a $3 or $4 delivery charge.

One thing that annoyed me about the hotel, though, was that they added an AU$1.30 charge to the bill as a donation to UNICEF. This tactic has been discussed often on Flyertalk. I really detest it.

I take my philanthropy quite seriously. I investigate organizations that I give to in order to understand their mission and their effectiveness. Giving to ineffective charities is worse than a waste – it’s counterproductive and harmful to the intended beneficiaries of service, because it crowds out better charities (most studies suggest that total giving is a fixed pie in any given year, driven more by economic conditions than events, and that specific solicitation tactics when successful simply shift which charities benefit).

Although I guess if I wanted to know more about UNICEF, I could have watched the dedicated TV channel they had at the hotel!

Since I want the charge removed, I make a trip down to the desk on my way out. They’re more than happy to take it off and do so instantly, but it’s an unnecessary trip. I actually stewed on it for awhile after receiving the bill under the door early in the morning.

Tuesday, June 14

3:00 pm Depart Sydney (SYD)
Qantas Flight 443
Coach Class Boeing 767

Left the hotel about 1:15pm and caught a cab to the Sydney airport (AU$30.50). There wasn’t any traffic at all and were there in no time flat.

At checkin I mentioned that I was flying international first the next day and the CSR didn’t charge an excess baggage fee. We had (4) pieces to check and would only have been entitled to (2) without fee. Our international segment was on a different ticket – this was a standone one-way red e-deal – so the ongoing flight technically shouldn’t have made a diference. But I guess was saved AU$20.

We were assigned seats 54 J, K. That’s the last row on the right side of the plane in coach. The flight was completely full with every last seat taken, and there was no opportunity to switch.

Our inbound aircraft was late arriving, so we boarding about 10 minutes late, pushed back at 3:15pm, and were in the air at 3:30pm.

UNICEF sure seems popular here, as the flight attendants were hawking for donations as well.

Snacks were apples and packaged cookies and drink service was whole ‘mini’ cans of soda, mini water bottles, and coffee/tea.

Flight was pretty bumpy but short. Bags came out in about 20 minutes, and we were on our way out of the airport.

Westin Melbourne

After an AU$39.50 cab ride to the hotel, checkin was smooth. I was given a slightly oversized room with a large (balcony-sized) bay window. There were chocolates in the room waiting for us. Bags were delivered to the room within minutes.

Just like the Westin SYD, there were electronic do not disturb signs. Very modern style.

Hotel’s bar, Martini Bar, seems very W-like, even broadcasting the name in colored lights on the sidewalk outside.

Room had a nice bathroom, a large double sink, mirror the length of the whole bathroom, and like the Westin SYD an overhead shower in addition to removeable standard-placed showerhead. Bed was comfortable.

These two Australian Westins seemed to follow protocol well, identifying guests respectfully by last name, and answering the Service Express line promptly and cheerfully (always responding to requests with “of course,” “certainly,” and “I’d be glad to”).

We ordered a pot of coffee at 6am, the room service delivery charge was $4 here rather than the $3 at the Sydney Westin and Intercontinental. So our pot of coffee – which wasn’t all that large – was $13 + $4 delivery charge. I guess they need to build the lack of a % add-on into the price. Heh.

We checked out of the hotel a few minutes before 8am and the bellman offered us a cab (~ AU$45) or a BMW (AU$65) to the airport. Since there was a cab right up front, we just took it. The cab stalled on the way to the airport, something about having just changed types of gas.

In Sydney

We stopped by the Sydney Fish Market on the way to my family’s place from the airport to pick up dinner, then Thursday went to the Taronga Zoo (let me know if anyone wants pictures, for the moment I’ll just share this sign which particularly amused me). Then lunch on the water and back to change for the evening.

My family had arranged a private tour of the Opera House, and then we had prime seats for a new play, Two Brothers. (Which was fine, some of the humor a bit too locally Australian for us really to get, but for a political play it was way too unsubtle for my tastes – in the very first scene we learn that conservatives are characterized by their heartlessness and desire to see immigrants die for their own ends.)

On Friday we went shopping and then we checked into the Intercontinental for the evening. We didn’t want to stay in the suburbs that night, as we had a dinner booking at Tetsuya’s.

On Saturday we walked around Manly, and on Sunday we had brunch at an enjoyable Sardinian restaurant, Pilu at Freshwater Beach. On Monday, for our last night, we decided to spend it in the city so I made an impromptu award booking online at the Westin Sydney.
Read the rest of this entry »

Monday, June 6

1:50 pm Depart Bora Bora Motu Mute Airport
Air Tahiti Flight 459

The night before we received a ‘departure letter’ with a printout of our folio, a Starwood Luxury Collection survey, and a departure time. We were scheduled for 11:30am which would have left us with 2 hours at the BOB airport – way too long with nothing to do. I went to the front desk and had them change our departure until an hour later, which I think caused them to make an extra airport boat run as there were a couple of other folks from our resort on the plane and they didn’t come over on our boat.

After approaching the airport dock by boat, checkin at BOB took 2 minutes tops. There was no line and the airport was more or less deserted. No comment about overweight bags, they didn’t look at my receipt showing I had prepaid the overweight fees.

There was no ID check. There was no security at the airport whatsoever. Nothing stands between the entrance to the airport and the gates. Inside the airport is a refreshment stand and two small gift shops. Bathrooms are nice with flowers but signs say the water isn’t drinkable. This is the gate area.

There were only 12 on the flight to PPT. We boarded 15 minutes early and were in the air at 12:45pm – the scheduled boarding time. Service again was a plastic cup of juice, no choices.
Read the rest of this entry »

Wednesday, June 1

11:10 am Depart Papeete Intl Tahiti Faaa
Air Tahiti Flight 452

Egads, we were about 45 minutes ahead of my planned schedule. After a 5 minute cab ride (1500 CFP) I went to check in.

There are 2 domestic terminals at Faaa and 1 international. Entering the airport, the first terminal is for Air Moorea, then the international terminal, followed by Air Tahiti (VT). Several shops, an upstairs restaurant, downstairs shops, Bance Socredo, McDonald’s, and business center.

Checkin requires you to first screen all bags, which then receive a tag. You take them over to checkin yourself after that (at least at LAX at the TBIT the bags are taken to checkin with you and you aren’t allowed to touch them after screening, couldn’t you put something dangerous in after receiving the tag? Maybe they aren’t worried about terrorism, but then what’s the point of the screening anyway?)

International passengers (I wasn’t asked to prove it, by the way) get 20kg checked luggage apiece. We were over, and were asked to pay an excess baggage fee. I was offered a 30% discount for paying the roundtrip charge up front – 6900 CFP by Visa for about 2 small roller suitcases worth of stuff roundtrip. I wondered if BOB would even weigh the bags, or if I could have gotten away saving money and just paying one-way? Given my experience on the return, I highly doubt I would have been asked to pay excess baggage charges on the way back. In fact, they didn’t even look at the receipt I was told to hold onto and present on the return checkin.

Carryons were limited to 3kg, they didn’t weigh ours which was good because they too would have been overweigh.

Checkin took no more than 5 minutes. Now I had about 2 hours to kill. We walked through the shops, grabbed a coke in the cafeteria, and sat down. I realized I was right next to a little girl with chicken pox – which I’ve never had! – so we moved and I started worrying about a ruined trip. Well, I didn’t catch it from a few minutes and the little girl probably wasn’t contagious any longer anyway.

We went through security and into the terminal. There are three gates which are really just separate lines/exit doors a la a domestic express carrier. Small snack shop inside security along with bathrooms, and flatscreen TVs above the gates showing promo videos of the islands.

The plane was an ATR 72 with 68 seats. Service consisted of pineapple juice of some kind. I was certain to be sure we sat on the left side of the plane – an important thing, actually, for the phenomenal view of Bora Bora on approach (here and here).

We get off the plane and enter the terminal and each major hotel has a desk. Bora Bora Nui is the first on the left. The woman asked if I was mr. gleff as I approached. Apparently we were the only Bora Bora Nui guests arriving on that flight, they had come to the airport just to get us. (When making reservations, you’re asked to email your flight information ahead of time.)

Bora Bora Nui Resort & Spa

The woman from the Nui handed me luggage tags that were pre-filled out with my name and room number on them. As I picked up a bag, a porter took it from me and made sure I just pointed to whatever was mine. (No other resort seemed to have a porter to handle baggage.) When they had all 4 bags we went to a boat that took us to the resort. We didn’t see our bags until we made it to our bungalow.

We arrived at the overwater checkin and they already knew who were were. We were greeted by Tahitian music and we were seated and were each given a small chocolate cake shaped like a heart and chilled rosewater as I filled out their paperwork which was primarily asking to confirm our departure flight (so they could ensure proper transport back to the airport).

After returning the check-in paperwork we were taken by golf cart out to our bungalow. We pulled up to #109 which I had mentioned in advance as my first choice (followed by 108 and then 104-106). I figured I must have misread the luggage tags at the airport which I thought said 105, but the woman from the hotel couldn’t open the door with the key, checked her paperwork, and backed up to Bungalow 105.

109 is known as private for being at the very edge of the resort and facing out at the water without really being seen by any of the other bungalows (108 is equally private, perhaps more so, but gets less sunlight). However, the resort’s boats cross in front of it all day long it would seem, so I’m not sure how much I would have enjoyed it.

It turns out that I was very happy with #105. The two common criticisms of the resort are that it isn’t very Tahitian (more opulence and American-style luxury, which for this trip I rather appreciated) and that it’s on the ‘wrong side’ of the motu facing away from the main island, thus having no view of Mt. Otemanu. To my surprise, #105 is unique in having a direct view of Mt. Otemanu! It has a nice sunrise view, not much of sunset, and in fact much of the day’s light is gone by noon. It isn’t a place to lay out tanning in the afternoon, but that was perfect for us – it was a refuge from the sun, and we were able to lay around coolly and comfortable for the afternoon, especially after spending time in the sun at the beach. In the end I wouldn’t have wanted any other bungalow (well, maybe Royal Suite 107, but even that would have been only the most marginal of improvements).
Read the rest of this entry »

After posting about my hiatus on the 26th of May, I received several emails asking what the beautiful beach photo was. The answer: the Intercontinental Beachcomber Resort on Tahiti, which frankly was just an airport hotel.

I was on an award trip during which I spent a whopping 670,000 miles and points, including: 290,000 American Airlines miles (2 first class tickets to Tahiti, Australia, and back on Air Tahiti Nui and Qantas); 176,000 Starwood points for a 5th night free award at Bora Bora Nui; 60,000 Priority Club points for 2 nights at the Intercontinental Tahiti; 24,000 Priority Club points for a night at the Intercontinental Sydney (during a 20% off award sale); and several other redemptions.

After a flight to Seattle in Alaska first class, a stay at the W Seattle, then down to LA (Alaska in first) and a night in a Marina View suite at the Ritz-Carlton Marina del Rey, I headed off to Tahiti…
Read the rest of this entry »

Via David Rowell,

280 fully armed soldiers boarded a chartered DC10 to fly from Atlanta to Kuwait. M-16s, pistols, bayonets and knives were everywhere. But, as the soldiers made their way through airport security, they had to surrender nose hair clippers, pocket knives and cigarette lighters.

500 free Hilton points for filling out a 7 question marketing survey. Points post instantly.

Hat tip to Free Frequent Flyer Miles.