United’s Houston to Aspen Route: A Middle Finger to Its Pilots – BNET Headwinds
Man, these BNET guys really like to make those headlines pop. But, well, it’s accurate (especially since I said it in the text). This is not going to help pilot negotiations.

Virgin America Loses Money — Again — When It Should Have Profited – BNET Headwinds
Q2 numbers are out and Virgin America lost money once again. It didn’t lose much, but these are the best possible conditions around for making money.

Southwest Flight Attendants Agree to Fly Larger Planes — Now For the Pilots – BNET Headwinds
Looks like I was wrong. The flight attendants have come to agreement on flying the 737-800. But the pilots are still not settled.

United Agrees to Keep Cleveland Hub, But the Deal Has No Teeth – BNET Headwinds
United agrees to keep a hub in Cleveland, but I call political shenanigans.

Why Delta Is Banking on Cargo To Amp Up Profits – BNET Headwinds
Another story from my visit to Delta. This time, it’s all about cargo.

United Air Kiosks, Logos Will Signal Merger’s Progress – Bloomberg
I was asked when I would start using a single brand in the United/Continental merger.

Ok, so I didn’t actually take the new saddle seat for a test ride. I mean, it was a static display in the Airline Interiors Expo hall, but I did get to sit in it for awhile and check it out. The verdict? It’s absolutely uncomfortable, but I think it’s a great idea. Kudos to Aviointeriors for at least trying to come up with a solution that matches passenger demand. The only problem? I can’t see how this passes regulatory hurdles. So I suppose I should put those kudos on ice.

You’ve heard about this thing, right? Well, if not, take a look at this bad boy:

But that picture doesn’t really tell the story. Instead, take a look at this picture with me squeezing myself into the second row.

As you can see, I’ve got a wedgie like no other. Kind of like when I first went horizontal in an angled lie-flat seat. The seat itself isn’t very comfortable. It has no moving parts, so tall people are in real trouble. (You’d think they’d have an up and down function for tall people, but that adds parts and weight. They may need to rethink that.) It doesn’t recline either. There is a tray table, but good luck using it for anything. Oh, and the armrests are even narrower than in coach. That combined with the fact that the saddle seat pushes your legs sideways means you’ll have a very intimate experience with your next-door neighbor.

So, uh, what do I like about this? Well, there are a lot of people that just want cheap fares. This seat weighs a lot less than a regular seat (the goal is to get it under 5kg per seat) and it takes up a lot less space. So that means lower fares can mean higher profit. This seat has 23 inches of pitch, which means that it’s 23 inches from the front of one seat to the front of the next seat. Compare that to a roughly industry standard 31 inches, and you can fit a lot more in a space.

Let’s look at a Spirit A321. Spirit has roughly 30 to 31 inches of pitch, but let’s just assume it’s 31 inches for simplicity sake. Here’s what the back cabin would look like with the saddle seat.

Instead of 82 seats in the back cabin, you can probably squeeze 112 in. Pretty good, eh? But let’s put this another way. If Spirit needs to make $75 per seat on a given flight to break even today, adding the saddle seat in that back section could bring in the same amount of revenue at only $55 per seat. That’s a big difference for the passenger.

I don’t see this kind of seat as being the kind of thing most airlines would want, but even those that do wouldn’t outfit their entire cabins with this seat. Think of it as Economy Minus. (or, on United, Economy Minus Minus.) I could see low cost airlines with a large percentage of short haul flights looking to take advantage of this seat. Think of Spirit, Allegiant, Air Asia, and yes, Ryanair. If the price is right, people will do it. It’s the right fit for some airlines, and I imagine we’ll see someone try something similar at some point.

But there is one huge, ugly problem. Regulation. The Aviointeriors people said that they’ve been in touch with the regulatory bodies and they don’t foresee a problem, but I do. In particular, I wonder if these seats will be able to meet evacuation test rules which require everyone to be out of the plane within a certain amount of time. Also, the seatbelt wasn’t on the seat, but it rides really low over your legs. I think that may need to be changed. (I wish it had a harness to keep you from spilling over and prevent you from breaking your skull on the seat in front.)

But if they can get past the regulatory problems (and that’s a HUGE “if”) this seems like a great idea to me. I, however, will be happy to pay more for a real seat.

And now, the talk you’ve been waiting for. Let’s talk SkyMiles. As someone who considers himself miles-agnostic (meaning it doesn’t impact my flight purchase decision), it’s kind of funny that I end up getting into the details with these programs. But I know that it’s a topic that’s important to a whole lot of you. And SkyMiles is one of the more talked about programs.

It’s a program that many elite members love to hate, but it hasn’t deterred them from actively participating. Sure, many former Northwest elites have put on the rose-colored glasses and miss the days of WorldPerks, and others have a long list of complaints as well. It’s a tough balancing act for the airline, and that was the chief topic of discussion when I sat down with Jeff Robertson, VP of SkyMiles.

Despite what you might imagine, Jeff doesn’t wear a bullseye on his back, but he really does enjoy debating what’s right for the program. I found him to be thoughtful, and when our allotted time was up, the conversation just continued, probably to the dismay of the people waiting outside for his next meeting.

As you might imagine, he began by saying that “we want to do what’s right for Delta.” Of course, that’s never going to please everyone, but I was particularly interested in what that meant for dealing with the competition. American and United/Continental were that ones that had me most interested because they are the main competitors, have more flexible award use and, in my opinion, have better availability at the lower levels. So what about them?

He admitted that it’s really difficult to compare availability across airlines without just manually looking at routes, but they have recently decided to work with a third party to help get better insight on what others are doing. So this isn’t something Delta is ignoring. Then, he went to the spreadsheet to talk about availability.

It seems that Jeff has his availability reports accessible at all times. He pulled one out to give me a snapshot of what he was seeing. “We were tight this summer with availability.” But things are now more open. It seems that this will be an ongoing struggle for the airline, but it is something that is constantly on the radar.

Some more interesting topics from our discussion . . .

On Eliminating Last Minute Award Fees
“When we eliminated the award redemption fee, the percent of increase in redemptions was tremendous. It was one of the best decisions we’ve made. That’s not coming back.”

On One Way Redemptions
“There’s no reason we haven’t done one-ways. It’s just not at the top of the priority list.”

On Having Three Redemption Tiers Instead of Two
“The purpose was to provide another pricepoint that wouldn’t require double miles. We felt like introducing 40,000 and 60,000 is the right solution. Really, 40,000 miles is becoming popular. We have 90% or greater availability in that tier. So instead of someone spending 50,000 miles to come back at 4p on the Sunday after Thanksgiving. They can spend 40,000 miles to come back in the morning on Sunday or 60,000 to come back at 4p. It helps us manage demand.”

On Upgrade Co-Pays
“It would be really easy for us to do a copay. I don’t like them, so it’s not a priority of mine. I have bigger fish to fry.”

On Only Allowing Elite Upgrades From High Coach Fare Classes
“We have looked at YBM [the three highest fare classes that are the only ones allowed to be upgraded on international flights]. The #1 ask in the elite program is to let us upgrade off discounted fares. Two reasons why we don’t.
1) We don’t historically because we have free domestic upgrades, so we don’t subsidize international upgrades by making people pay for domestic.
2) We measured upsell to M [so that the ticket could be upgraded] and it is hundreds of millions of dollars
So we continue to look at what things do we do to YBM to make it more valuable, provide a better service benefit.”

On Rollover Miles
“Rollover miles are paying off big time. Elites are significantly ahead of where they were last year excluding rollover.”

On Getting Feedback
“The most important feedback for us is what we get directly. We also do surveys, and yes, we look at FlyerTalk, blogs, news media.”

On Choice Seats
“When we rolled out Choice seats, we got killed [in the media]. But American rolled out the same program and there’s been nothing. Delta’s the only carrier not charging. Is it gaining us market share? At the same time, I hate them myself, so it’s tough. I do think seat assignments are the next horizon [for fees].”

On Mileage Earning
“We have the most generous earn program. We always give a full mile regardless of fare class. We always give 500 minimum miles per flight to every passengers. With that said, we’ve looked at recently how many miles we give per dollar – it’s about 5 miles per dollar spent with great variation. We’re looking at what to do.”

On the Future of the Frequent Flier Program
“The frequent flyer model of over-awarding is not sustainable and must be changed. It’s either going to be redemption or accrual or both.”

–
Yep, it was an interesting discussion. Now let the commenting begin. I know you all have plenty to say.

Good morning from Long Beach. I love when a conference comes to me instead of making me go to it. This year, the World Airline Entertainment Association came back to Long Beach, (and changed its name to the Airline Passenger Experience Association to make it sound more awesome). I was asked to be one of the judges to determine the single best achievement in inflight entertainment this year, so I thought I’d share with you some detail on how I looked at the group. Etihad may have won, but there were others that were quite deserving as well.

When the winner was announced, I found myself wishing that any further information had been given. I mean, it’s great to win, but shouldn’t other airlines get the benefit of knowing what made for a winning entry? I wrote about Etihad over on BNET, but here I want to focus on the other four finalists. Here they are in reverse alphabetical order (’cause it’s just more fun to shake things up like that sometimes).

Virgin America
Virgin America (and V Australia which also uses the Red entertainment system) were big winners overall, as you would expect, but the airline came up just short in this category. After winning last year with its menu-ordering system, Virgin America submitted its open tab functionality this year. I love this functionality, as I wrote before. In short, instead of having to swipe your card every time you want to buy something, this allows you to simply swipe once and then close-out at the end of the flight, like a bar tab.

The beauty of this is that it’s good for everyone. Passengers like it because they only have to swipe their credit cards once. The airline likes it because people spend more. In fact, Virgin America says that in the short month that it’s been on the fleet, there has been an appreciable increase in revenue, primarily food and beverage. Great stuff, an incredibly simple concept, and this is certainly worthy of being a finalist.

Emirates
The entry from Emirates was for a complete revamp of its passenger service video. This was a very strong entry as well, though I imagine many of you don’t even know what the service video is. When you depart on Emirates, you used to get a bulky, 5 minute long video explaining all the features on the flight. Using the entertainment system, making calls, frequent flier program benefits, etc, were all part of it. What the airline found was that 5 minutes was too long, and having shot these in aircraft cabins made for a very difficult process when a change was required. (Emirates doesn’t have any spares, so an airplane had to be pulled out of service for filming.) Instead, Emirates came up with a new concept.

Instead of getting into details on how to do everything, Emirates decided to make the video more of a primer to whet your appetite. It was cut down to 2 minutes, and nothing was filmed on the aircraft. Instead, most of it was filmed on a green screen and cut in ways that images could be inserted very easily, if changes were needed. The result? A very slick video that gets across enough basic info to get you interested. It also is so easy to update that it will never need to cost an arm and a leg to update in a timely manner. That’s good for the airline since it keeps costs low and good for the passenger since it keeps things up to date. And at only 2 minutes instead of 5, it’s much more pleasant as well.

El Al
El Al submitted its first new safety video in 8 years, and I think that makes it tough off the bat.

I mean, passengers don’t care about the safety video in general, and in fact, they hope they never have to use the information in there. But it’s obviously important information, and if a new video can get passengers to pay attention, that’s a big benefit. Air New Zealand has seemingly mastered that effort with its Nothing to Hide campaign (which won the award for best safety video this year). But El Al did create an entertaining, mildly funny, and informative video here.

The video is animated, and it’s hosted by a fairy that’s a flight attendant. (Hold your jokes, please.) The helpful fairy floats through the cabin explaining what needs to happen. It’s a good safety video, for sure, but it’s hard to see how this could be the single best achievement. Still, El Al has done a really good job of creating something that will keep passengers’ attention. And that does deserve some recognition.

Air France
Lastly, we have Air France which submitted its USB download feature this year. This is only on the A380, but essentially the airline will let you download a variety of content to a thumb drive so that you can take it with you to use on a layover or in a destination. I can see this being helpful with things like destination guides and transport maps (which are both offered) and with games for kids to keep them entertained. But will this be worthwhile? An increasingly large number of people are connected on the ground, so they might not be as interested in this. Also, who wants to carry a thumb drive around? I have to assume the ultimate goal is to have it sent via the internet to a smart phone or computer for easy access.

But for now, it’s hard to judge this. One of the proposed benefits is that it will enable the airline to create a new stream of revenue. Advertisers and content providers will need to line up to pay for this, but that hasn’t happened yet. It’s only on the A380 so there aren’t enough eyeballs for that to happen just yet. I could imagine a time where someone browses a destination guide and then has a coupon sent directly to a smart phone. That’s compelling, but it’s just not there now. Maybe this will prove to be a great move in a year or two, but it’s too early right now.

And that was it. They put us judges in a room on Sunday to listen to presentations from each of these. We had some really good debate about each one, and in the end, Etihad came out the winner, but not without a lot of contemplation.

The Air Travel Consumer Report covering July flights is out, and the Department of Transportation release on so-called “tarmac” delays had the same subject line as it did last month with only the month’s name changed.

“Long Tarmac Delays in July Down Dramatically from Last Year”

Yes, the DOT has decided to crow once again about how few long ground delays there were with “only a slight increase in the rate of canceled flights.” Really? I would think a 20% increase in canceled flights would be a little more than “slight,” don’t you?

That’s right. Forgetting about the DOT’s rounding to a single decimal point, the cancellation rate rose from 1.18 to 1.43 percent, an increase of more than 20 percent. Had the same cancellation rate from last year held for this July, there would have been 1,442 fewer flights canceled this year. If you assume 100 people on each flight, that’s nearly 150,000 people impacted.

Small increase, huh?

But don’t think that this is me crowing that the rule is failing miserably either. There are other issues here as well that came into play. The DOT doesn’t like to dig into these things, but it’s very important to look at where the cancellations came from.

The bulk in July came from Delta, which had a miserable month all the way around. Of the 8,170 canceled flights in July, more than 3,000 came from Delta and its regional affiliates. Delta also failed to run even 70 percent of its flights on time, joined in that exclusive bottom-dwelling club by wholly-owned subsidary Comair and Continental’s main regional, ExpressJet.

So what happened to make Delta’s month so terrible? I knew this was coming, so I made sure to ask Glen Hauenstein, CMO and EVP Network Planning, Revenue Management and Marketing when I was at Delta a couple weeks ago. The full interview will be published later, but this snippet is entirely relevant.

We gave ops a very challenging schedule to achieve. In turn, ops was trying to streamline some of its practices. We may have crossed in the night on that. By the second week of August, they were at the top of their game.

So they had issues and eventually fixed them, but those issues certainly contributed to the cancellation rate for the month. Does that mean that the DOT should continue crowing about how awesome its rule-making ability is? No. As Glen says . . .

We have turned back flights getting close to 3 hours and have canceled them. The total number is not that great, but if you’re on a plane that gets turned back at 2.5 hours and cancels, then it becomes very personal.

True. And Delta wasn’t the only one seeing increases either. While the legacy operating carriers did mostly hold steady (outside of Delta), their regionals took more of the heat. For example, American Eagle and ExpressJet both saw fairly substantial increases in cancellation rates.

So where does this leave us? Once again, it’s hard to draw conclusions despite the DOT’s need to do so for political purposes. Without knowing exact cancellations due to the ground delay rule, we can’t see the true trade-off.

We know for sure that there have been additional cancellations, but nobody wants to talk exact numbers. Any airlines out there want to start releasing details? Come on, you know you want to.