When Southwest bought AirTran way back in 2010, all eyes were on Atlanta to see what the airline would do there at AirTran’s homebase and biggest hub. What followed was months of shrinking, but now Southwest has moved on to phase two. It is de-hubbing Atlanta. That sounds radical, but, uh, what does it really mean? Let’s take a look.

The new de-hubbed schedule goes into effect in November, so I looked at a Monday in December and compared it to a similar day in December 2009, before the merger, to show what’s happening.

When Southwest took over AirTran, there was hope that this meant the combined airline was going to be able to use the AirTran 717s to serve smaller markets. Instead, Southwest shipped those off to Delta for cheap and shrunk the AirTran system dramatically. You can clearly see the results of that first phase in this chart:

I included one summer date in there just for comparison purposes. AirTran was always a highly seasonal airline, so I thought it was interesting to show. But if we look at the December before Southwest took over, AirTran was running 199 daily flights to 51 destinations from Atlanta. By this December, Southwest will have shrunk Atlanta departures by more than 20 percent, dropping the hub to only 156 daily departures.

At the same time, it has shed a net of 7 cities. But that destination count isn’t exactly telling the whole story. Most smaller cities in the US have been dropped while some growth has occurred in the existing Southwest network and to the Caribbean.

I thought the shrinking work was done, but I was wrong. In this new schedule, Southwest decided to end service to another three smaller cities from Atlanta: Buffalo, Pensacola, and very interestingly, Memphis. (They’ll still be in the Southwest network, just not from Atlanta.) Instead, Southwest has added nonstops to Hartford and Oklahoma City.

I was surprised to see Memphis lose that flight. It’s not so easy to compete against Delta when that airline’s costs have dropped while Southwest’s have risen. But that’s not the point here. The point is to talk about what this whole de-hubbing thing means. Let’s take a look at a cross-section of a day in Atlanta:

As you can see, the distribution of flights has changed dramatically. Previously, AirTran was set up to be able to fill more flights by flowing more people through Atlanta. That’s why nothing left before 8a; there needed to be time to get people from other cities into Atlanta to fill the flights out. (During the summer, there were earlier flights.)

You can see the big banks were in the morning and late at night. Southwest has changed that around. Now mornings are still busy, but you see a more even distribution through the day. However, that late night hub has basically been dismantled. AirTran used to have 24 flights departing after 930p. Now there will be 4.

That probably means reduced aircraft utilization, and that means costs will rise. Delta must love that. But it also means that Southwest is scheduling flights to be at times that are more attractive to travelers in Atlanta itself. And Delta doesn’t like that.

Keep in mind, this doesn’t mean Southwest is abandoning connecting traffic. When Southwest bought AirTran, 60 percent of Atlanta traffic was connecting. Southwest expects to see Atlanta connections drop to 40 percent of the total traffic in Atlanta, similar to what’s in Chicago and Baltimore. So Southwest is still going to take a huge amount of connecting traffic – it’s just not scheduling for it anymore.

It seems like that should make sense – local traffic has long been more lucrative than connections. Connecting traffic has become more valuable, however, thanks to consolidation and rising fares. But the valuable connecting traffic is coming from smaller cities for the most part. And those are the cities that Southwest abandoned when it bought AirTran.

So Southwest is focusing on local traffic and flight times in local market will generally get better. There are now early morning flights to places like Washington/National and New York/LaGuardia; that makes day trips for business easier to accomplish. In theory, it should mean business travelers in Atlanta will now be more likely to use Southwest if they like Southwest’s product offering, oh, and if they don’t need to fly to smaller cities that have now been abandoned.

Looking at the big picture, this whole “de-hubbing” means that Southwest took what AirTran had built in Atlanta and then dismantled it. It then rebuilt Atlanta to look like every other focus city in the Southwest network. So why did it need AirTran in the first place? Well, it’s a lot easier to build an operation with only one big competitor in town instead of two. It’s the same exact thing we would have seen in Denver if Southwest had succeeded in buying Frontier.

In Atlanta, Southwest saw opportunity, but it couldn’t make it work with a much lower cost carrier in the market. So it decided to buy it and effectively shut it down, making way for its own operation.

Southwest Airlines: We’re Not Really About Cheap Flights Anymore – Time
I spoke with Brad Tuttle at Time as a follow-up to my column about Southwest’s new ad campaign.

Critics: United frequent-flier lawsuit is ‘absurd’ – USA Today – Today in the Sky
Ben Mutzabaugh picked up on the Plain Dealer’s piece as well as my blog post talking about Hongbo Han’s lawsuit over earning miles on United.

In the Trenches: Creating Value With Price Increases – Intuit Small Business Blog
We’re introducing priority assistance but it was tough to figure out the best way to do it.

Airplane Cabin Photos: KLM’s New Business Class Seats and Design – Conde Nast Daily Traveler
I put together a slideshow looking at KLM’s new business seats. It’s long overdue and a welcome change.

Has everyone seen Southwest’s latest ad campaign? I’ll guess not since the new 60 second spot debuted in the unwatched first round of the NCAA Men’s Basketball tournament. So, take a minute (literally) and watch it here before we discuss:

Does anyone else see the delightful irony in this ad? This is a brand ad. It’s supposed to warm the cockles of your heart so that you relate to this airline. It is supposed to help you connect with a strong brand identity. As the press release says, “The campaign reinvigorates the Southwest Airlines brand and reveals its story as one that people may not perceive it to be.”

What’s so ironic about that? The “brand reveal” is accomplished with a soundtrack, the song Some Nights by fun. I’ll just give you a little snippet of the chorus:

Oh, Lord, I’m still not sure what I stand for oh
Woah oh oh (What do I stand for?)
Woah oh oh (What do I stand for?)
Most nights I don’t know anymore…

Do people just pick songs because they sound catchy instead of reading the words? This ad is just pure… bleh. It says nothing to me. This could be for Southwest or any other legacy airline. (In fact, the lofty goofiness reminds me of plenty of legacy airline ads of history.) Or it could be for a healthcare company, even better, it’s like watching an ad that sells trucks. Seriously, just put the Bob Seger song “Like a Rock” over this ad and you’ll think they’re selling Chevys. Just listen to some of these lofty words in the ad that really don’t say much:

• “people who find their own path, chart their own course, who never stop moving forward”
• “the American dream doesn’t just happen, it’s something you have to work for”
• “never finished, never satisfied, and we never stop looking for a better way”

Is this really Southwest? This is an airline that knows how to market itself. Or at least, it used to know. My favorite commercial of all time came from this airline many years ago. Way back in the 1980s, the CEO of America West, Ed Beauvais said he thought travelers would be embarrassed to fly Southwest. How did the airline respond? CEO Herb Kelleher filmed a spot with him having a paper bag on his head. He told travelers Southwest would give them a paper bag if they were embarrassed. They could use that bag to hold all the money they’d save.

That’s not what we’ll ever see from Southwest today. Then again, I suppose it’s a much tougher task these days because the chorus of that song is true. Southwest doesn’t seem to really know what it stands for.

It’s no longer the low fare leader, though the brand halo still survives. A recent study shows that just comparing airfare (not baggage), Southwest was more expensive than competitors 60 percent of the time. It still sticks to the no change fee, no bag fee policy but it has made a lot of noise about how it needs to add new fees. Just this month, Southwest CFO Tammy Romo said “I’m not saying it’s necessarily going to be a change fee. But we’ll certainly start moving in the directions to tighten some of the restrictions on our lowest priced fares sometime in 2013.”

Meanwhile, the airline has finally begun codesharing with wholly-owned subsidiary AirTran, further muddying the waters. If you buy a ticket from Southwest, you have no bag fee or change fee. If you buy a ticket on AirTran for the exact same flights, you pay the bag fee and change fee. The exact same flights. Confused yet? You aren’t alone.

So what does Southwest stand for? I’m not even sure the airline knows. And that may very well be why it’s putting out ad campaigns that say… nothing. To be fair, future spots are supposed to focus on the inflight product and on Rapid Rewards, so those might be better. But this first commercial from the airline’s new partnership with TBWA\Chiat\Day is not off to a great start.

Those of you who read Southwest’s blog might be familiar with my favorite series, Flashback Fridays. Each week, Brian Lusk, corporate historian and longtime airline dork dug into Southwest’s history and pulled out some fascinating photos and tales. Unfortunately, Brian died yesterday, just barely into his 60s. Fittingly, it’s Friday today, so I thought it was worth doing a different kind of Flashback Friday, the kind you never want to do.

That picture above shows the day I met Brian, at the BlogWorld Expo on November 8, 2007. That’s him and former Southwest social media queen Paula Berg manning the booth. We talked a lot about the industry, as airline dorks do when they get together, and it was just the first of several times we were able to meet over the years.

Brian and I shared a love of LA aviation history, and I was fortunate enough to swap stories with him over a Double Double at the In ‘n Out near LAX. Though he was at Southwest for nearly two decades, he spent about the same amount of time working for Delta before that. And his father was an airline guy as well, so Brian lived through some incredible times in the industry.

So instead of having a regular “topic of the week” this week, take a little time to appreciate Brian’s work. You can thumb through some past Flashback Fridays and you’ll see how great he was at making history come to life. Fridays just won’t be the same without him.

Southwest’s latest schedule is out, and guess who is paying attention to Memphis? It’s not technically Southwest yet, but Southwest is using its AirTran subsidiary to add destinations and flights in Memphis. As one airline fades in the land of Elvis, another grows. The circle of life continues.

Back in December, I profiled the remains of Delta’s hub in Memphis which now has fewer than 100 flights daily. At the time, I said the cuts “should open the door even further for someone like Southwest to come in and bring fares down.” And that time has now come. Like a vulture feasting on the carcass of a rotting corpse, Southwest sees opportunity in the remains in Memphis. I don’t doubt that’s the case.

As of this summer, AirTran had scheduled only 4 flights a day between Memphis and Atlanta on 717 aircraft. In other words, it’s great if you want to get to Atlanta and you aren’t time sensitive. Sure, there are some connecting options, but it’s a very minimal presence. That changes on August 11 when AirTran adds 1 daily to Orlando, 1 daily to Baltimore, and 2 daily to Chicago/Midway, all with 717s. This looks a lot like a Southwest schedule, doesn’t it?

That’s why I was a little surprised to see this flown by AirTran, because it fits quite nicely into the Southwest service pattern. But now I get it. First, Southwest and AirTran just started limiting codesharing. It will be up and running soon on the rest of the system. So Southwest can really use AirTran as a trial balloon. Think about it. It can put a smaller airplane (717) into these markets so it has fewer seats to fill. Oh, and it can charge bag fees and change fees as well. So putting AirTran in this market lets Southwest test the waters to see if these routes are going to work out or not.

It would seem likely that they would work. Delta still has up to 3 daily mainline airplanes flying from Memphis to Orlando so that appears to be a good market. And while Delta doesn’t fly to Midway or Baltimore, it does fly to O’Hare and National. Still, the real point is that AirTran can connect people into the Southwest network at both those points anyway.

I would assume that this is just the start of what we’re going to see happen in Memphis. As Delta kills off its presence there more and more, that provides opportunities for others to come in. And while I don’t expect to see Memphis grow to the size of Nashville for Southwest, I imagine this is just the first of several new flights that the airport will see. Southwest doesn’t have a ton of growth opportunities in the US, so this should be a welcome one.

So will this now please all the locals in Memphis who crow about how awful and expensive Delta is? Nah. This gets those people to a few more places, but it’s not going to solve all their problems. It will, however, be very interesting to check in with them in 5 years to see if they’re happier at that point. They might have lower fares on some routes but they’ll have fewer nonstop destinations. We’ve seen this play out in many cities around the US.

By that point, I imagine Delta will have little more than flights to other hubs in the Delta system. But will others have replaced it with enough service to please Memphians? We’ll find out.

[Original Memphis Belle photo via Richard A. McGuirk / Shutterstock.com]