Friday 19 September, 2003

Good morning.  It has been a busy week, with a massive number of responses from my Spam Survey.  If you haven't answered this yet, and can spare a few minutes, please click on over and share your own spam thoughts and experiences.  If you have answered it, thank you, and please send the url on to your friends and get them to answer too.

With over 750 responses to date, some surprising findings are emerging.  But I'll leave the analysis until a future week, after the survey closes.  However, one response I can offer now :  Many of you volunteered a related complaint - the dislike of popup and pupunder browser windows.  I use the Alexa Toolbar as a free way of controlling these popups.  It isn't perfect, but it is a lot better than no control, and it is free!  It is a quick easy download and automatically installs in your Internet Explorer.  Recommended.

Many of you expressed doubt that the government would be able to control spammers.  While I generally agree with this, it is interesting to see the British government now attempting to outlaw spam and spammers.  Good luck (to the government, not the spammers!).

Another notable feature last week was the special email on Saturday announcing the Air NZ special fares to New Zealand.  As predicted, Qantas not only matched but improved on the Air NZ offer with a $498 roundtrip fare, and unlike Air NZ, doesn't then insult your sense of fair play by charging you a gratuitous extra $15 for issuing your ticket.

My sources suggest that Air NZ has a surprising amount of empty space on its flights for the rest of this year, and Qantas has added the better part of 1000 extra seats a week between LAX and Auckland, so there might be more 'super special deals' to NZ.

Blogger Gary Leff quickly wrote in and pointed out some tricks that could get you an even more discounted Air NZ fare.  This information is on his blog.  You'll also note an option to sign up for his newsletter, which ensures you don't miss out on his occasional deal spotting and other regular pithy commentary.

I said that the special fares to NZ cover a great time of year to visit.  Conventional wisdom, of course, suggests you should only travel to NZ (and most other countries) in their summer, but, to be blunt, conventional wisdom is just plain wrong about this.  Unconvinced?  Then read this week's feature column -

This Week's Column :  When is the Best Time to Travel? :  A simple change in travel dates of only a day or two can save you hundreds of dollars.  And a change of a week or two can mean you avoid a crush of other tourists.  Here are 16 tips on how to choose the best time to travel on vacation.

Dinosaur Watch :  Good news for the dinosaurs (sort of).  Systemwide unit revenue rose 8.1% in July and 9% in August compared to the same months last year.  Unit revenue, or revenue per available seat mile (RASM), measures how much money an airline generates by flying one seat one mile.  An increase in RASM can be obtained by increasing the average fare, and/or by increasing the percentage of seats carrying paying passengers.  Most of the increase in RASM has been due to the airlines having higher load factors, which in turn is due not to flying more passengers, but rather to flying less planes!  So the improvement in RASM, while welcome, doesn't point to a similar underlying strengthening in travel.

Potentially bad news for employees at mega-dinosaur United.  The government estimates that the worst-case pension shortfall for UA could be $7.5 billion.  The Pension Benefit Guaranty Corp - the federal agency that bails out troubled pension plans - advised a bankruptcy judge that this was the amount by which liabilities would outstrip pension assets if the airline were to seek the court's permission to terminate its pension plans.  Even by airline loss-making standards, a $7.5 billion shortfall is a staggering sum of money, and the betrayal of commitments that such a shortfall represents to UA's employees is shameful in the extreme.

Robert the Bruce was a Scotsman who fought against the English and lost.  Undeterred, he fought against them a second time, and lost a second time. He then fought them a third time and won, securing (a brief) independence for Scotland.  It seems that UA is applying the Robert the Bruce theory to its airline business plan.  After having failed with its United Shuttle low cost operation, it is now pressing on with plans to reintroduce another low cost airline operation, but this time to be based in Denver.  Fares will match those offered by low cost airlines such as Frontier, Southwest and JetBlue.  It is very unclear how United will be able to profitably succeed in these activities, because it will not have anything like the low cost structures of Southwest and JetBlue.

Perhaps anticipating increased competition from UA, Denver based airline Frontier made a surprising announcement on Thursday.  It has signed a 12 year agreement with Horizon Air (a low cost subsidiary of Alaska Airlines), whereby Horizon will provide regional jet service under the name Frontier JetExpress.

It seems that the same concept of joining forces that applies to the major airlines (eg NW DL and CO or UA and US) can also apply to the smaller airlines, too.

And the concept of joining forces, and response to competition in general, is not limited to US airlines.  Here's an interesting quote from Qantas CEO Geoff Dixon. Remember, as you read this :

  1. Qantas wanted to effectively merge with its prime competitor on trans-Tasman routes, Air NZ
  2. Qantas has a joint operating agreement with its prime competitor on its London routes, BA
  3. Qantas has been pressuring the Australian government not to let Singapore Airlines fly between Los Angeles and Sydney, meaning that only one other airline (UA) currently competes on this very profitable route.

And so, with this as background, what does Dixon have to say about competition?  On Wednesday, giving the Sir Reginald Ansett Memorial Lecture in Australia, he was quoted by Dow Jones which reports

He [ie Dixon] said Qantas isn't afraid of competition, and in fact wants to "compete at the highest level."

Hmmm....

Here are two examples of competition.  One good and one not so good.

Firstly, the trend towards giving more room to coach class passengers continues.  After AA emasculated its 'more room throughout coach' product, JetBlue responded by taking out a row of seats on its planes, meaning that some (but not all!) rows of seats now have more legroom.  Another low cost airline, ATA, is now taking 16 seats out of its 757 aircraft, increasing its seat pitch from a previously cramped 30" to a more generous 32" or 33".  ATA is the tenth largest airline in the US, and hopefully this enhancement in their flight comfort will help them to become still more prominent.

Second, the not so good.  It used to be that while airlines would compete with each other in public, they'd also work together (in the best sense of the term) behind the scenes to help out if one airline had problems, so as to ensure the traveling public was least inconvenienced.  The most obvious example of this is one airline's willingness to accept passengers off another airline's cancelled flight.  Of course, this is not altogether altruism - the airline that accepts the distressed passenger gets fairly and profitably paid by the other airline, and on the basis of 'what goes round, comes round', all airlines benefit by working together.

This concept is falling apart, as cost accountants greedily focus on one part of the equation without considering the broader picture.  As this article explains, Delta is now seeking an unusually high level of compensation from its arch-rival AirTran when accepting AirTran passengers onto its flights in Atlanta.  This is hardball on DL's part, with, inevitably, the ultimate loser being us - the traveling public.

And for an extraordinary example of competition at its ultimate, Ryanair is giving away 2 million free seats on its flights between now and Christmas.  People had four days to book on any of the airline's 131 European routes, and needed to only pay taxes to get their tickets.  Unbelievable.  But marvelous.

Southwest Airlines has skirted industrial relations disaster several times in the past, but now seems increasingly likely to be forced to swallow a dose of this bitter medicine.  The airline has asked for assistance from national mediators after 16 months of talks with its flight attendants collapsed, and the flight attendants are launching a national ad campaign to publicize its views.  One of the keys to Southwest's success has been its positive relations with its staff and the low cost structure it has secured from them.  This now seems to be in jeopardy.

Looming trouble also at America West - an airline that is struggling to re-invent itself and which is reporting some paper thin profits at present (but any profit is better than the massive losses the dinosaurs are suffering).  Their pilots have been in contract negotiations since early 2000 with no new agreement having been secured, and now are talking about changing their union in an attempt to get more forceful representation of their views.

Can any of the America West pilots (or the Southwest flight attendants)  say 'beware of killing the goose that lays the golden eggs'?

Here's an interesting development that contradicts 'conventional wisdom' about the lack of business class traffic.  Lufthansa is now operating business-class only flights between Newark and Düsseldorf, Chicago and Düsseldorf, and Newark and Munich.  Using a charter airline to provide the service, it is operating 737-700 and A319s - planes that normally have up to about 150 passengers, but which instead have only 48 business class seats per plane, with four flight attendants to give a service-intensive experience.  LH claims the flights are very successful, with a 75% load factor, and only about a $1200 (one way) fare.  More routes are being considered.

First class passengers on US flights can now start to enjoy using a metal knife once more.  NW reintroduced them (with the TSA's blessing) on Tuesday this week.  CO will follow on 1 November, while AA says that it is 'evaluating its options'.  Although you can now expect a metal knife (but with a rounded rather than sharp point to it) on board, don't try bringing your own knife with you - such things are still forbidden for passengers to carry.  Yes, you can use them on board, but you can't bring your own.

Airbus proudly announced this week that it is on track to meet its target of delivering 300 planes this year, and it expects to match that number in 2004 and increase it in 2005.  300 planes is a lot (and a lot more than Boeing will be delivering) but compare that with market analysis that suggests a potential need for 2400 new planes in China over the next 20 years, valued at $197 billion.  As I mentioned a few weeks ago, it is unsurprising that Boeing is considering assigning a 'lucky' (by Chinese standards) number to its new 7E7 plane in the hope of boosting its dropping market share of Chinese aircraft orders.

Boeing's choice of name for the 7E7 - the 'Dreamliner' proved too tempting for Airbus, who acidly pointed out that while the 7E7 remains merely an abstract dream (Boeing has yet to commit to manufacture this plane and its specifications continue to evolve) the massive new A380 super-jumbo jet is very much a reality.

In a stunning display of misplaced corporate arrogance, Boeing VP of Marketing for Commercial Aircraft Randy Baseler said, speaking of Airbus, 'What do you mean by market leader? Do you mean who can deliver the most discounted airplanes? If that's the case, then okay, Airbus wins'.

Doesn't this sound familiar?  It sounds just like the comments of Boeing's clients, the dinosaur airlines, who all pretended not to care what lower cost airlines were doing, and now are suffering massive losses and reduced market share as a result.  The ability to deliver a lower priced plane of comparable performance to its competitor is a key parameter for marketplace success.

Boeing has been losing massive market share to Airbus in almost all markets, and all Boeing can do is to sneer at Airbus as being a supplier of lower priced airplanes and say 'then okay, Airbus wins'???

A growing threat to both Boeing and Airbus, as well as their airline customers, took another step forward this week.  Microsoft is releasing a new internet based conferencing program that makes it easier for companies to hold 'virtual meetings' without needing to fly executives to attend an in-person meeting.  While nothing can replace the informal socializing and ancillary networking that occurs in a 'real' meeting, not all meetings need to be fully fledged in-person events, and improved quality (and lower cost) video-conferencing software presents as a viable option for many less strategic meetings.

As support of the marketplace demand for such an alternative to in-person meeting, Microsoft quoted a new survey that claims 72% of frequent business travelers consider taking a business trip at least as stressful as going to the dentist, and 56% who say it is at least as stressful as doing their taxes.

Who would you rather have on Amtrak's board of directors?  A failed Democratic Presidential candidate (and former Governor of MA), a former mayor of Meridian, MS and a former governor of VA?  Or Robert Crandall, formerly AA's chairman, plus former K-Mart chairman Floyd Hall, and former World Bank official and railroad privatization expert Louis Thompson?  In an excellent move that should help Amtrak build itself into a viable business more than simply throwing more money at its current failed business model, President Bush announced his intention to nominate the latter three people, to replace the former three people on Amtrak's board.

This Week's Security Horror Story :  Imagine that you're 65.  You recently retired, and moved away from your rust-belt former address to live in Florida.  Of course you sold your former home, and bought a new home in Florida.  Ooops.  One proposed new anti-terrorist screening program would use this information to consider you a probable terrorist!

Although we don't know what factors will be used in the new CAPPS II passenger-screening software that will scrutinize every passenger's electronic database records, sharp-eyed privacy advocates spotted a website that inadvertently published a presentation given to a security conference that talked about unusual factors that might indicate terrorists.

As soon as this became public, the information was pulled off the website, but another website had already taken a copy of it, and you can read the presentation for yourself on this site.  One clear factor was that elderly people rarely change address, and so if you do change address, you're calling attention to yourself.  No wonder estimates suggest that as much as 10% of all passengers might get wrongly labeled as possible suspect terrorists in this new system!

But this is just the start of the scandal.  This study last year was based on the analysis of 5 million passenger itineraries, given to it by JetBlue.  Look on JetBlue's website at their privacy policy and you'll see the simple statement that is impossible to misunderstand

The financial and personal information collected on this site is not shared with any third parties, and is protected by secure servers.

Add to this the statement from a JetBlue spokesperson

No JetBlue customer information has been shared with the US Government with respect to testing the CAPPS II program currently under design.

and it would seem plain that anyone who ever booked a flight with JetBlue has never had and never would have their personal information passed on to other people.  This impression is, alas, completely wrong!

The full story of JetBlue's perfidy can be read here.

Our politicians' love affair with illegal immigrants from Mexico continues unabated, notwithstanding all polls that show an overwhelming preponderance of US citizens are opposed to making it easier for illegal immigrants to live in the US.  Reader Lan points out the remarkable situation in California where an illegal Mexican immigrant will be able to obtain a Californian driver's license using questionable Mexican ID, and suggests that, because of this, Arizona is passing legislation refusing to recognize CA drivers licenses as valid ID!  He also points out the mockery of requiring 'government ID' at airports if a terrorist can simply travel through Mexico and illegally into California, then obtain a CA driver's license without showing any credible ID to establish his bona fides or identity.  Will the TSA also refuse to accept CA drivers licenses?

What is the point of demanding new high-tech visas from lawful visitors to the US if the terrorists will simply come in illegally through Mexico and then be aided and abetted in creating 'lawful' ID by the Californian state government?

Meanwhile, Britain has an astonishing approach to immigration checks.  The UK Daily Mail revealed that its reporters had tested Britain's immigration security by traveling into Britain through airports ten times, using passports that weren't there own.  According to the paper, 'Men were waved through with women’s passports, and women carrying men’s.'

And what does the British Home Office say about this?  Rather than expressing horror, a spokesman said

The service has to tread a fine line between maintaining an effective immigration control and ensuring that bona fide travelers suffer minimum inconvenience.

Accordingly, people who hold British passports and who are therefore not subjected to immigration controls go through more expedited checks than the holders of non-EU passports. However, we would be concerned that our passport procedures are being abused.

Last week's feature column reviewed the Bose Quiet Comfort 2 noise reducing headphones.  I said '...their excellent performance is offset with a few niggling design issues that are not well thought out'.  Reader Michael wrote in to say

While reading your latest posting on the QC2 earphones I found it troubling to see you use the word "niggling" in your review. I am not African American but the use of a word with the prefix "nigg" is offensive in most circles I travel in, live in, work in and play in.

The word 'niggle' dates back to 1616 and is entirely unrelated to the word 'nigger' (why is it that society allows and accepts the prolific use of four letter swear words but now frowns on the 'n' word?).  Surely political correctness has run absolutely amok when one is asked not to use words that simply sound like different words which the gentle reader finds offensive!

While you might be forced to remove your shoes while going through security, our airports remain as insecure as ever.  A GAO report tells how, this summer, their inspectors evaded detection by airport screeners after concealing box cutters among their belongings.  At no time were any of the inspectors ever stopped by security screeners.

But at least these people were only testing airport security.  They weren't testing the gullibility of the great American public.  For some light relief, look at this picture of a counterfeit $200 bill (!) that was successfully accepted by a cashier in Roanoke Rapids.

Reader Bob writes how his brother flew on 9/11 (03) and noted a greatly increased level of security at the airports.  So much so that he was not allowed to post a letter on the secure side of the airport, due to 'security reasons'.  No-one was able to explain exactly what the security issue was that made posting letters dangerous.  So he carried this dangerous letter on the plane with him and posted it when leaving the airport at the other end.

And reader Alex also has mail problems.  He tried to email the TSA, using the link from their website.  Unfortunately, his email addressed to TSA-ConsumerResponse@tsa.dot.gov was returned to him as undeliverable!

Another of my lonely crusades is the danger posed by cellphones to their users.  Here's a worrying new report that suggests a new side-effect of too much cellphone usage - early senility!  As I've said many times before, the ignored dangers of cellphone radiation are this generation's equivalent of the ignored dangers of cigarette smoking 50 years earlier.

Lifestyles of the rich and famous?  A new hotel, an exact replica of the Capitol Building in Washington DC, is to be built close to the Spanish resort of Marbella.  Except that there will be one significant difference.  The hotel will be gold plated from top to bottom, and gold dust will be pumped into its swimming pools and fountains.  The hotel, to be named 'Aurum XXIV' will use 12 tons of 24 carat gold in its construction.  That is $115 million for the gold alone.  No wonder that room rates are proposed to start at $6,000 a night.

Lastly this week, if you do decide to take advantage of the cheap flights to New Zealand, be careful if you attend a traditional Maori welcoming ceremony as part of your tourist experience.  A British tourist was seriously injured with a broken jaw and deep cuts to his face last week after he was accidentally hit by a spear that was being brandished by a Maori as part of a 'welcoming challenge'.  The company that operates these tours suggests that visitors stand at least ten feet back from the performer, who, according to the police report, 'swings the spear over his head like a helicopter rotor'.

Until next week, please enjoy safe travels, and stand well back from people brandishing spears

David M Rowell aka The Travel Insider
ps :  Don't forget to visit Joe Brancatelli's site for his weekly updates, too.

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