Welcome back to Part 2 of my interview with Dave Barger, CEO of JetBlue. If you missed Part 1 which discusses the problems in Long Beach along with the general product direction, then you might want to go check it out.

In Part 2, Dave and I talk about inflight wi-fi, big changes coming to the TrueBlue program, and some future international partnerships, including Lufthansa. Let’s get on with it.

Cranky: What about wi-fi? I know you have one plane, BetaBlue, with email and instant messaging, but what about a full broadband solution now that many other airlines are doing it?

Dave: We believe that narrow band [the BetaBlue product] is the model. We’re going to start a fleetwide campaign for narrow band by year end. But, if it makes sense for full wi-fi capability, we want to be able to respond. That being said, we believe narrow band included in the price of the ticket for the whole airplane is best.

Cranky: Do you like the narrow band product itself or is it just technically better for you?

Dave: We’re pleased with the product. For us, the product is TV, radio, and connectivity, not just wi-fi. It can also be a great tool for our crewmembers as well as the customer. It could be used for irregular ops. If we need a flight attendant to go to Rochester and overnight there, we will be able to email them on the plane. Then when they land, they can make a call to tell who they need to tell.

Cranky: Or they could just email them on the plane.

Dave: Yeah, exactly. As a quality of life application, it’s good.

Cranky: Let’s talk about TrueBlue. My wife and I were doing a fair number of flights to the Bay Area last year to prepare for our wedding. We flew JetBlue, but there was no way that I was going to ever reach an award with short haul travel, so I didn’t even want to sign up. The only reason I eventually did was because I wanted to use a credit from a changed flight online and I had to sign up for that purpose. Are you going to make changes to the program?

Dave: I totally agree that it’s not relevant right now. It’s interesting to hear your opinion, and I agree. It worked for its early life cycle, but it needs to change. We are going to roll out a new program in Q2/Q3. You can think of it as TrueBlue 2.0.

Cranky: Glad to hear it. Though I suppose it’s bad news for you that we flew you anyway and didn’t need the frequent flier credits.

Dave: No, these programs are important. They’re very powerful and we need to do better. Partners are an important piece of that. Can you accrue on Lufthansa? What about Hertz? These are important.

Cranky: What can we expect to see with the new program?

Dave: One of the biggest complaints we hear is that people say they can’t get seats. We do have a lot of availability, but people say they want last seat availability.

Cranky: Will you have last seat availability as a standard or will you be looking at tiered rewards like other airlines?

Dave: We believe we will have a best-in-class frequent flier program. It’s going to be very customer relevant.

Cranky: I know we’re running short on time, but really quickly I’d like to talk about partnerships. You mentioned on the panel today that you were seeing 100 passengers a day connecting into your network from Aer Lingus. That’s really surprising to me. What else might we see?

Dave: Partnerships with Lufthansa and Swiss are next. They’re strategic investors in JetBlue, and we will have partnerships with them. After that, well, I was serious with Ali [Al Rais of Qatar Airways] about doing something with Qatar [as mentioned on the panel today].

Cranky: Could we see some partnerships on the west coast, maybe with Asian carriers? I imagine that would have to go to LAX though.

Dave: Sure. The potential could be there for partnerships at LAX. We can’t do that in Long Beach, but there’s no reason two operations in the LA Basin can’t work for us.

Cranky: Thanks, Dave. Let me know next time you guys are out in Long Beach.

Dave: Will do. And congratulations on your wedding.

So there you have it. A Lufthansa partnership is on its way, and Dave really doesn’t see a need for full broadband right now. I’m not sure that I agree that the narrow band solution will be enough, but as long as they’re watching this closely and willing to change quickly, then they should be ok. I’m also glad to hear that TrueBlue is going to be fixed, because it really isn’t a compelling program as it stands today.

Again, if you missed Part 1, click here.

While I was at the Phoenix Symposium last week, I had the chance to sit with Dave Barger, CEO of JetBlue to talk shop. I had planned to chat mostly about the airline’s plans to keep the product fresh, but after I mentioned I lived in Long Beach, Dave became quite vocal about the status of things around here. It appears that there’s trouble in paradise, and leaving the airport entirely is not out of the question.

We did get to the product discussion after that, and as you’ll see tomorrow in Part 2, we also talked about the state of wi-fi onboard, some serious upcoming changes to TrueBlue, the airline’s frequent flier program, and some brand new international partnerships on the way. But enough of that. Let’s get to the interview.

Cranky: It’s good to see you again Dave. I always pay particularly close attention to you guys since I live under the usual departure path out of Long Beach. I’m also probably the only guy in my neighborhood who would like to see more flights out of the airport. So, I certainly watch what happens with you and the airport in general very closely. But let’s get to my first question. Many people describe Virgin America as being the “cool” airline, and that’s something that used to be used to describe your brand. What are you guys doing to take back that title?

Dave: Let’s talk about Long Beach for a second. It has been a huge frustration for us. They need to make good on their commitment to improve the airport experience. The City of Long Beach couldn’t have a more committed partner than JetBlue, but it’s been difficult.

Cranky: So what exactly is the problem? Is it that you can’t use your E-190s in the commuter slots?

Dave: We would like to be able to use our E-190s in those commuter slots. That’s the perfect use of those slots, because these aircraft are very quiet. But the best example is that it took us 30 months to build a brand new terminal at JFK but we’re still stuck in temporary trailers in Long Beach. I don’t think communities always realize what an economic tool an airport is. You can’t take commercial air service for granted.

Cranky: How much of an issue is this? Would you consider leaving the airport?

Dave: Well, LAX is part of our LA Basin strategy, but it becomes a necessary part because of the lack of partnership with the City of Long Beach. People might have to go to LAX to use us, because we’re actually wanted there.

Cranky: So you would leave Long Beach?

Dave: I wouldn’t take any option off the table. Municipalities must make good on their commitments. That includes parking, terminals, baggage claim and every other part of the experience. The message I would give is that especially in a recession, you shouldn’t take air service for granted.

Dave: Now, to get back to your question about the product, we want to keep refreshing it. We’ve won the JD Power award 4 years in a row, and we have our Strive for Five program now, but we want to keep improving.

Cranky: What does that mean in practice? What can customers expect to see?

Dave: The question is not “how do you create a club atmosphere when people get on the plane?” We’re not talking about mood-lighting or cool-colored seats. We don’t think you have to order from your seatback. Our focus in on the whole cabin as opposed to just First Class, not just the 8 seats up front. It’s LiveTV, it’s XM Radio, but it’s building the brand for the long term.

Looking back, I wish I would have pressed a little more on this subject, but time was short, and I had a lot to discuss. Come back tomorrow and I’ll have Part 2 with his thoughts on inflight wi-fi, changes to the TrueBlue program, and new international partnership opportunities.

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Greetings from the Phoenix Aviation Symposium here in, well, Phoenix, of course. The first day was action-packed with plenty of technical talk about the industry, but instead of throwing out a ton of random information, I thought I’d focus on one piece that actually can impact the public. Let’s talk airports.

There was a lively panel yesterday morning that involved leaders from airlines, airports, and the FAA that was called, “Airports – Adapting to Change.” Most airports around the US have seen big drops in the number of flights over the last few months. Some, like Ontario or Oakland, have lost much more than others. So in this climate where flights are shrinking across the board, what can be done to stimulate new flights?

This was the question that kept the panel busy for a long time, and ultimately the discussion centered on airport costs. Bob Montgomery, VP of Property and Facilities for Southwest, made it clear that “there is not a direct relationship between the airport cost and our decision on service. For all the emphasis we put on airport costs . . . it’s next to impossible to show that direct relationship [but] airport costs are important, they end up in the equation.”

JetBlue President and COO Russ Chew was more forceful by saying, “discipline around cost control and capital spending are crucial.” Both carriers made it clear that while cost isn’t everything (JetBlue does fly out of JFK, one of the most expensive airports around), it can have a major impact on service levels.

The reality is that airlines will put their planes where they can make the most money (or lose the least during times like these). When an airport increases costs, that rarely ends up increasing revenue by the same rate so it makes the airport less competitive when an airline is looking for places to add (or just not cut) flights. While having a decent, functional facility is important (yes, I’m looking at you LAX), building something that’s overly expensive and ambitious will end up hurting in the long run (still looking at you, LAX).

And for airports that think that PFCs are an easy way to get around this problem, they’re wrong. The latest FAA re-authorization proposal would allow airports to charge up to $7 in Passenger Facility Charges (PFCs), up from $4.50. These fees are implemented by the airport on passenger tickets to pay for airport projects. For most travelers, the PFC just shows up as another tax adding to the total cost of the ticket. By increasing this charge, airports may not increase their costs to the airline but they increase their costs to the end user. And when that goes up, that means the airlines get less money from a $200 ticket than they did before.

Of course, when that happens, that means the flights are less profitable and the threat of fewer flights is real. So, what can customers do about this? Well there are a couple things. Flying more often and paying more money always helps (duh). The more people flying, the lower the costs per enplanement (CPE), since there would be more enplanements. But there’s another solution that doesn’t often get exercised.

Since your airport is most likely publicly run, you can keep an eye on what’s happening to costs at your airport. Nearly everyone’s costs per passenger are going up since there are fewer passengers to bear the costs, but some are worse than others. (Yeah, Indianapolis, that big empty terminal was pretty pricey, huh?).

Unfortunately, I don’t believe there’s an easy way for just anyone to look up your airport’s cost per enplanement, but a Google search can often (but not always) help turn things up for you. You can always contact your airport and ask for more info or talk to your councilperson if the city runs the airport. The point is that these are your tax dollars at work, so you should make sure that your voice is heard.

Ok, let’s get back to our regularly scheduled programming. As I mentioned yesterday, I had the chance to go visit Southwest Airlines earlier this week. Why? Well, I was one of the winners of Southwest’s schedule planning contest, and the reward was a trip to come out to headquarters for a day of fun.

I wasn’t sure I could make it because it conflicted with US Airways Media Day, but when I heard that I would get to meet Herb Kelleher, I had to go. Despite rumors that he’ll live forever, I didn’t want to take that chance, so I made the trip while I could. It was definitely worth it, and the whole day was just good fun.

The day started off with the best part . . . meeting founder and former Chairman, President, and CEO Herb Kelleher along with former President and heart of the company, Colleen Barrett. As an airline dork, Herb was always one of the guys that I looked up to as a kid. He’s one of the last of a dying breed of true airline leaders, and the stories surrounding him are legendary. So simply to be in his presence was awesome.

They’ve set up an “Emeritus” wing at headquarters for Herb and Colleen. I believe the official definition of Emeritus is, “people who kind of want to retire but not really,” or, uh, something like that. We all gathered in Herb’s office which had a western theme to it. Herb pulled up a few chairs and the three winners, the other two with their wives, and a couple other Southwest folks sat down to chat.

Herb was in a really good mood, and he was telling stories and constantly unleashing his trademark laugh. This was pretty surprising since we had found out that he’s just started to quit smoking. I would have expected some serious crankiness.

Most of our time was spent hearing him tell stories and ask us questions about what we did for a living, etc. When I told him I wrote Cranky, he said that his assistant actually prints it out for him. If that’s true, well, howdy Herb! Colleen joined us about halfway through, and the half hour went by very quickly.

After the requisite picture-taking, we went over to meet with Pete McGlade, VP of Schedule Planning. (I’m fairly sure he wasn’t interested in my request for the return of Indy to LAX, but I had to try.) Then it was off to tour around the building and have lunch.

After lunch, we headed out to Love Field. A couple of ramp managers took us around on a tour of the airport down below. But this was no ordinary tour – it was interactive. As you can see, they had me slinging bags for a few minutes. My guess is that if I did that for a full shift, I would probably be in serious pain. Rampers must be in great shape because they get one heck of a workout.

Public Service Announcement: Pack lighter. Seriously. Your stuff is too heavy.

We walked around the ramp and saw Herb’s Hangar, the place on the ramp where Herb parks his car when he flies. Now that’s a killer perk. We went through the ops center and then through the crew base. The flight attendants were preparing for the big Southwest chili cookoff by having a semi-final round where people had to pick the best of eight.

Attention Southwest people: If #2 won, then the rest of you should be scared.

After the tour, it was back to headquarters where we had the chance to crash some planes, er, some fake planes. They brought us over to the training center which has 7 simulators and another being installed. Each of us had the chance to go in to a 737-700 simulator, depart from Love Field, fly around downtown, and then come back again and land.

I naturally assumed that I would immediately crash, but that wasn’t the case. Our instructor was doing most of the hard work for us, and we were just using the yoke and the throttles. If we ever got close to screwing up (or should I say, “when we got close”), he would make a slight adjustment and then tell us that he didn’t do anything – it was all us. Very slick, and, well, none of us crashed.

I do have to say that the sim is incredibly life-like. I was getting sweaty palms just from the sensation of being in this thing. It felt like I could actually crash something. Clearly I wasn’t meant to be a commercial pilot.

While we were there, they took us around to some other training devices. We all put on life vests and inflated them on command. And we took turns opening the 737-700 window exit. That is a lot harder than it looks. If you ever need to open that door, yank down on the handle as hard as you can so it swings open quickly. I wish everyone had the chance to try that, so they could know what it’s like.

As I said, this was just a lot of fun. The highlight for was clearly meeting Herb, but the rest of the day was excellent as well. Thank you, Southwest, for bringing us out for the day. And next time, let’s get some harder scheduling problems to solve!