There’s nothing I like more than ripping apart the Department of Transportation (DOT) for its poor rule-making abilities, but every so often, the department does something right. We might as well celebrate on the rare occasion when that happens. Yesterday was one of those days as the DOT doled out slots at Washington’s National Airport.

The DOT had four slot pairs to give away at National as part of the recent Federal Aviation Administration (FAA) reauthorization. As a quick refresher, National has a rule that prevents any flights longer than 1,250 miles from operating at the close-in airport. About a decade ago, Congress started allowing exemptions, primarily so Congressmen could fly nonstop to get to their home district (my interpretation, at least).

As part of the reauthorization bill this year, eight more slot pairs (one takeoff and one landing) were added to the pool. Four of them were meant for the big incumbent airlines at the airport. These airlines could convert one normal slot to one long haul. Here’s what they did.

• American will start a daily flight to its Los Angeles “cornerstone”
• Delta will add a second daily flight to its Salt Lake hub
• United will start a daily flight to its San Francisco hub
• US Airways will start a daily flight to San Diego

With the stage set, there were four more to give away either to new entrants or limited incumbents. There was a lot of competition for these, so the results weren’t easy to predict. Let’s start with the losers.

• Air Canada wanted to fly to Vancouver, but it’s a small, highly seasonal market.
• Alaska wanted to fly to San Diego, but that was its second choice. Once US Airways announced it would fly the route, this became a tough sell.
• Frontier wanted to fly to Colorado Springs, but that’s a very small market and would have been hard to justify.
• JetBlue wanted to fly to Austin, but that was also a second choice and Southwest put that up as its first choice.
• Sun Country wanted to fly to Vegas, but there are already a lot of flights in that market and Sun Country couldn’t connect people anywhere from there either.

Each of those had a big flaw, especially when compared to the four that seemed to deserve the flights far more. Incredibly, those four are actually the ones that won. Here they are.

• Alaska gets one daily flight to Portland. Portland is the airline’s second hub and has a decent-sized local market. Alaska will not only bring good service to the locals, which are largely loyal to Alaska, but it also adds good connecting options for a lot of small cities. This one seemed like the most obvious winner to me.
• JetBlue gets one daily flight down to San Juan. This one is a great move since JetBlue has been building up its presence in San Juan. This gives nonstop service to a place that will benefit from it, and it also opens up new connecting opportunities into the rest of the Caribbean. I like this route and how it fits into JetBlue’s strategy quite nicely.
• Southwest gets one daily flight to Austin. Nobody flies to Austin from National today and if anyone can serve it well, it’s Southwest. That’s why Southwest was obvious for this route while JetBlue was a longshot. It’s no surprise that Southwest won this.
• Virgin America gets one daily flight to San Francisco. Even though San Francisco will already get its first nonstop to National from United, that certainly won’t be a low fare service. Besides, Virgin America was the only applicant with no service to National, so you had to figure that the airline would get a foot in the door. The airline actually wanted two pairs, but the DOT rightfully shot that down and spread the wealth. This market should do well.

So, for once, I’ll say “good work, DOT.” Something tells me this praise won’t last very long.

If you’d like, you can read the full decision at regulations.gov.

Why it Took So Long for Virgin to Link All its Frequent-Flier Programs – Conde Nast Daily Traveler
You can now earn and redeem across Virgin airlines. What took so long?

In the Trenches: Learning From My Team – Intuit Small Business Blog
It’s always good to learn something from the team.

United merger’s OK despite problems, experts say – Houston Chronicle
I was asked about how the United tech transition was going. You probably won’t be surprised by what I said.

Last month, Virgin America decided to sell a pretty unique deal through Gilt City. Anyone with $60,000 could get a roundtrip charter flight anywhere Virgin America flies in the US. That in itself isn’t that unique, but the purchaser also got something special . . . the right to permanently (at least as long as the airline exists) name an airplane in the Virgin America fleet.

If you think about it, this is a great deal, depending upon how you use the flight. With 146 seats, it ends up costing only about $410 per person for a roundtrip flight. That’s not bad at all. In fact, I even briefly toyed around with doing it myself and turning it into an airline dork charter, but I figured there was absolutely no chance at all that Virgin America would let me name an airplane “The Cranky Flier.”

This offer actually went pretty quickly and it ended up being purchased by a group of alums from the Stanford Graduate School of Business (GSB), my alma mater. I was able to find one of the co-conspirators, Liz Anderson, and she told me all about how this came together.

Apparently, she was on vacation with some other recent GSB alumns when this opportunity came up, and they started talking about it seriously. In the end, five of them agreed to go all-in and buy the thing. They put one credit card in and clicked. It bought the whole thing. Oops. Since I don’t believe anyone had a $60,000 credit limit, they called Gilt right away and had it split five ways. Then it was time to fill up the airplane.

The group decided to pitch this as Miami FOAM. What does that mean? At the GSB, classes generally run Monday/Tuesday/Thursday/Friday so people use their Wednesdays for a variety of other things. (I spent mind volunteering with a group called IHAD.) But one thing that was constant was that Tuesday nights were great nights for going out and blowing off a little steam to break up the grueling week.

The top 10 percent of students are known as Arjay Miller Scholars (he was a former dean), so when students created a weekly Tuesday night drinking club, the name naturally became Friends of Arjay Miller (FOAM). In other words, if you were out drinking instead of studying on Tuesday night, you weren’t going to be an Arjay Miller Scholar yourself. Part of the FOAM tradition is an annual trip to Vegas, where hundreds of students dress up in ’70s gear, fly down to Vegas on Tuesday night, party all night, and fly back the next day. Curious what that looks like?

That’s right. That was my first year trip down to Vegas. We had about 100 seats on that airplane, and just about everyone looked as stupid as I did. (I imagine that most of you can figure out which airline it was from that picture.) In fact, it was such a great time that I continue to do an annual alumni Vegas FOAM trip with friends from school. (Though it’s generally a lot more tame these days.)

For this organizing group, it naturally made sense to turn this opportunity into an alumni FOAM event, and they’d take the party to Miami. Why Miami? “We just picked the coolest, farthest place you can get,” Liz said. Since most of the group was still in San Francisco, they figured they’d go to Miami (Ft Lauderdale, actually) and spend the weekend down there with 141 of their closest friends.

The website went live and they emailed the 2009, 2010, and 2011 graduating classes. Within 30 minutes, they had 100 people committed, and it was completely sold out in less than 3 days. And why not? It’s a great deal.

Technically, the group isn’t allowed to sell seats on the flight. I assume this was a stipulation to prevent some corporate entity from buying up the package and re-selling it. So this group is charging for events on the ground. But let’s assume that $410 per person somehow gets allocated to the flight. That’s not a bad price for a weekend roundtrip from San Francisco to Miami on its own, but this is even better.

Since it’s a charter, they got to pick the departure time to fit their schedule (morning out, evening back). They also get to operate at a fixed base operator, away from the passenger terminal. This means that they don’t have to go through any of the security hassles everyone else faces. And they can bring liquids, etc.

But they don’t need to bring a lot of liquids onboard, because the flight includes free drinks (yes, alcoholic) and food. I’m afraid that with this group, Virgin America might lose thousands just on the booze alone. But if you’re a traveler, this is a steal.

And yes, they still get to name an airplane. What’s the plan for that? It sounds like the group wants to name it the “Friends of Arjay Miller,” but with Arjay Miller still alive, they’re trying to get permission from him first. Virgin America also has the right to refuse any name that’s suggested, but I can’t imagine there’s be a problem with this one.

Now that the trip is fully subscribed, they’re working on plans for while they’re there. There’s going to be a charity component to this that might involve auctioning seats or asking for donations along the way. That’s all in the works now, but I’ll post about it here when it comes together.

I won’t be on the flight, but I’m hoping that I can get someone who will to write me a trip report.

Pack patience for air travel amateurs – CNN Out of the Office
’tis the season for amateur travelers to come out of the woodwork. Here are some thoughts on how business travelers can navigate it.

In the Trenches: Recognizing Our Own Recognition – Intuit Small Business Blog
Just talking a little bit more about how to deal with getting recognized as a Top Travel Specialist by Conde Nast.

Virgin America dogged by reservations glitches – USA Today Today in the Sky
Ben got into some more detail about the Virgin America reservation system problems and he cited my post on the subject.

Tech tames travel’s travails – The Detroit News
A brief mention at the end about Cranky Concierge. Though we don’t actually have an app.

Alaska Airlines Menu Tasting Was Eye-Opening – Conde Nast Daily Traveler
A different look at my visit to the Alaska Air kitchens this week.

If you’ve flown Virgin America any time since October, there’s a good chance that your experience has been sub-par. No, it has nothing to do with the onboard product but rather the fragile technology infrastructure, which is still suffering after a reservations system change made back in October. That’s right, we’re talking well over a month and there are still widespread issues.

A reservation system change is a major undertaking. That system is the heart of the airline, and it talks to just about every other system in the company. So it’s not an easy thing to just switch on a whim. That’s why airlines prepare for a reservation system switch like they’re preparing for the apocalypse. Airlines have lately even shut down booking for a weekend, ramped up call center employees, and thinned flight schedules in order to deal with the pain. Virgin America did that as well, but it still wasn’t prepared.

Were it anyone else, people would be crucifying the airline. Virgin America, however, just doesn’t serve as many cities and doesn’t have the exposure that others would get when there’s a major failure like this one. Remember when US Airways transferred over to the pre-merger America West technology? For a couple of days, people were angry at what a mess it was. But that was just a couple of days. JetBlue and WestJet have also made reservation system transitions but none have seen the painful, persistent problems that have plagued Virgin America customers.

We’ve seen this first hand at Cranky Concierge with customers who still cannot check in online for their flights. They just have to wait until they get to the airport, unhappily. One frequent Virgin America flier reached out to me with a laundry list of problems that have made him miserable since day one of the switch. He couldn’t check in, change seats, or make changes online and call center waits for well over an hour. Frequent flier numbers bounced out of reservations, itineraries had incorrect billing information (terrible for those who need to submit expenses), and refunds have gone unprocessed. He even submitted a challenge to a charge for a ticket that should have been refunded, and Virgin America never responded to the credit card company’s inquiry. The credit card company just issued the refund.

So what the heck is going on here? This is just a mess.

The problem really centers around Virgin America’s IT strategy. Like many new entrants, Virgin America thought it could do things better than the existing carriers. Its Chief Information Officer at the time, Bill Maguire, was profiled in CIO magazine explaining how he was going to save the airline a ton of money by using newer architecture and by outsourcing just about everything. Maguire is long gone – left in 2008 and is at San Jose State University now – but his legacy remains.

Virgin America patched together its systems on its own, sometimes using open source software. For its reservation system, it went with a system called aiRES that never lived up to its promises. In fact, the launch customers WestJet and Virgin Blue, got so fed up with all the money they had thrown down a hole trying to get it working that both walked away. (WestJet is on Sabre, and the now-called Virgin Australia has announced an intention to do the same.) Virgin America also apparently quickly realized that aiRES wasn’t going to cut it and announced earlier this year it would switch to Sabre.

This was particularly important for Virgin America as it moved forward with a strategy to build tighter partnerships with other airlines. While a new and cool reservation system in a vacuum might function just fine, it’s a lot harder to get it to properly interface with airlines on other systems. And Virgin America was tired of waiting, so it opted to jump to Sabre.

The problem, however, is that its other systems were not very well suited to talk to Sabre, and that’s the problem we continue to face today. How these problems were not picked up in testing is unclear, but I’m sure Virgin America wishes it had done this differently at this point.

According to the airline, the number of problems have been diminishing and it says “we hope to have full resolution soon.” But this is still getting on toward two months after the new system went live. Virgin America continues to have a little blurb linked from the top of its homepage with an apology, but the text never changes. The only thing that changes is the date at the top.

So is there a way to know if you’ll be impacted by this mess? I asked, and there isn’t. I wondered if the problems came from reservations that were made before the switch, but that wasn’t it. While issues are more likely for older reservations, problems are plaguing new ones as well.

Hopefully we’ll see this fixed soon, but in the meantime, Virgin America is trying to at least compensate people.

We continue to waive all change/cancel fees for flyers having issues and Elevate members flying during this period have received a direct apology from our CEO and a free flight (5000 points) credited to their accounts.

That’s a nice gesture, but it still is not a substitute for just getting the problem fixed. This never should have happened the way it did, and Virgin America’s customers continue to pay dearly for it. With any luck, this will finally be fixed in the near future.