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Friday 5 September, 2008
Good morning
Wow - what an amazing transformation has
swept across the nation in the last week. Out of nowhere, the
surprise - and inspired - appearance of Sarah Palin has probably made
all of us appreciably more interested in this year's Presidential
election, and she certainly promises to energize the debate and
electrify her supporters.
I'd been sneering at a reference on the BBC
to this being 'the US's most important election ever', and I'm still not
sure if that was anything more than media hype, but whatever happens
come November, the leadership of our country will be profoundly
different than we've had in the past.
And now on to slightly less weighty matters.
People sometimes ask me how I come up with new ideas for new articles,
week after week, and wonder if it is hard or easy. So, if
interested, I'll trace what happened this week. I was working on a
new article series about the beautiful Cotswolds area of Britain that I
hope to publish for you soon, and realized that in addition to writing about hotels to
stay at in the area, there would be value in adding a page about how to
choose hotels in Britain in general, advising of some of the foibles and idiosyncrasies that can destroy an otherwise pleasant hotel stay there
if you're not prepared for them.
And then, halfway through that article, I
realized there would be good purpose in writing an article about
how to negotiate the best rate for hotel rooms, not just for Britain but
for everywhere.
And then, halfway through that article (are
you still following this long chain?), I
realized there was a lot more to the topic of getting the best rate for
hotel rooms than would fit
on a single web page, and so what was initially an afterthought to an
afterthought to a main article is now to become an article series of its
own.
Which is sort of the way the website has
evolved over the almost seven years to date - one thing leads to another.
And, even with about 400 articles already online, so far
there's not yet a reason to worry about running out of ideas for the future.
For example, coming up soon are some wonderful new GPS units I'm
currently testing, with exciting new
technologies to help you drive the best/quickest routes where you're
going, and lots more besides.
Anyway, with that as fairly lengthy buildup,
for you this week is :
This Week's Feature Column :
How to Get the Best
Rate for Your Hotel Room : In part one of this series, I
discuss how sometimes even a very slight adjustment in the dates of your
stay could make a massive change in the rate you pay.
By the way, some sharp eyed and curious
readers have asked why I changed the weekly column link from appearing
on the words 'This Week's Feature Column' to now appearing on the column
title. I've done that as a minor tweak for the benefit of search
engines, and here's a free tip to all of you with websites. Make
the text of hyperlinks to pages on your site as meaningful as possible.
For example, don't have a paragraph of text
which says 'If you want to know about some wonderful ways to (whatever),
then good news. I wrote a new page on my website about it.
If you'd like to know more about it, click here.'
Instead you should write 'Follow the link if
you'd like to know about some wonderful ways to
(whatever). I've just added this new page to my website
full of information about it.'
When a search engine spider reads the first
example, it looks at the link word 'here', which tells it nothing, then it
looks at the immediately surrounding words, which also tells it nothing.
But when it looks at the second example, the linked phrase tells it about the
page, and this encourages the search engine to feel more confident about
what your page is about (assuming that the content on the page matches
the link description!) and may give you a higher position in their search
results.
Talking about search engines and the
internet, have you tried Google's new Chrome web browser yet (you
can download it from their website)? It
currently only works for Vista and XP powered computers, and is handicapped by
not supporting some of my favorite add-ins like
Roboform and
Alexa, which is a disappointment.
But hopefully support for some of these add-ins will come, and maybe the
Apple users will eventually get a version too.
Everyone
I've spoken to is impressed and pleased, and in the space of little more
than 24 hours, the Chrome browser has become the fourth most popular web
browser in the world (as measured by which browsers are downloading web
pages all over the internet). It does have a slightly different
interface, of course, but it is quick and easy to master, indeed, I felt
a bit unsettled at the lack of options and settings to have to puzzle
through!
Isn't it astonishing to see Microsoft's
primacy being so severely challenged, on numerous fronts, by Google at
present. Well, actually, no it probably is not astonishing, and
Bill Gates himself has always worried about new challenges as yet unthought of to his empire. But what is astonishing is that
Microsoft have created the monster that is now snapping at their heels.
By attempting to marginalize Google by making their own Microsoft search
engine the default in their then dominant Internet Explorer web browser, they motivated
Google to create a competing web browser.
And while it might seem that corporate
empires are neither made nor lost over who gives away the most free software used for browsing
the internet, both Microsoft and Google know that in providing the
gateway to your entire internet experience, there are both current and
future opportunities for
them to create profit opportunities in the middle, and to gently steer
you to their other profit centers.
This struggle actually is a lot more than
just who gives away the most free web browsers. With Google now
providing free internet based software that rivals Microsoft's expensive
and overly complex Office suite, Microsoft is finding Google advancing
on it not only in the realm of free browsers but also into one of its
key areas of profitability - its Office product range.
Microsoft has other problems with Office,
quite apart from the Google alternative. To put Microsoft's
challenges with Office into context, I was given a free complete copy of
Office 2007 by a Microsoft employee and friend. After struggling
with it for a while, I gave up, and returned back to happily using
Office 2003. If Microsoft can't even get reasonably computer
literate and early adopting people such as me to upgrade to Office 2007
for free, what hope is there for Microsoft's entire corporate business
plan which is built on the concept of selling regular upgrades to their
user base?
But all is not lost. Microsoft has
launched a new consumer advertising campaign, with ads running an
unusually long (and very expensive) 90 seconds. Does the ad you
can see part way down
this page make you want to rush out and buy a copy of Vista?
Microsoft shares dropped almost 6% this week
- but Google has done no better, so maybe this is just general
marketplace malaise. It is certainly too soon to put Microsoft onto a
dinosaur/death watch, but it seems unlikely that it will ever return to
being the unstoppable growth stock that it once was.
Dinosaur watching : And so,
talking about dinosaur watching, at last we get to talk about some
dinosaurs. But let's be contrarian, and open with good news for a
change. With the ongoing service cutbacks, the skies and airports
are getting less crowded, and airline performance actually improved in
July 2008 compared to July last year. Ontime arrival stats were up
(an average of 76% ontime this year compared to 70% last year).
Best major carrier was Southwest with an 83% ontime rate; worst was
JetBlue with a 65% ontime rate.
Baggage problems were down - 4.9 mishandled
bags per thousand passengers this year compared to 8.0 last year.
Of course, one of the reasons that
mishandled bags are so sharply down is that the average passenger is
checking fewer bags than last year. With nearly every airline
charging for a second checked bag, and some airlines charging for a
first checked bag, we're checking less bags (and trying to squeeze more
into our carryons).
We're starting to see the August traffic
numbers come out and already there is one clear winner for the month -
AirTran reports a major 12.7% increase in revenue passenger miles, and
with an offsetting capacity increase of 8.9% this meant that flights
were more full - an incredible 87.3% load factor.
And, for every winner, there's an offsetting
loser, with this month's biggest loser so far being American
Eagle, with an extraordinary 13.6% drop in RPMs, and a smaller 4.5%
reduction in capacity, meaning their load factors are also down to a
mere 69.7%. Ouch.
Southwest will be joining most other
airlines in no longer accepting cash to pay for items purchased on its
flights. Only NW and UA still accept cash, all other airlines now
require you to pay for meals, drinks, etc, with credit or debit cards.
Congratulations to Continental.
Continental was named North America's best airline in the Skytrax 2008
World Airline Awards. The carrier also won an award for having North
America's Best Cabin Staff.
The awards were selected in an independent
passenger survey that included more than 1.5 million eligible survey
interviews conducted worldwide between August 2007 and June 2008.
Oil prices are retreating again after
the latest hurricane scare passed without causing measurable problems,
and oil prices that peaked at $147 are now down at about $107, almost a
30% drop. While some pundits are predicting the cost of oil to
drop below $100/barrel, you can count me out of that prediction.
However, whatever the price, it is plain
that airlines have been granted a major respite from high fuel prices.
So can we expect airlines to start dropping their fuel charges and
fares, and start boosting their profits?
Well, apparently not. Here's a
good but gloomy article that points out that, notwithstanding a drop
in the price of jet fuel from a high of $4.27 a gallon down to a current
$3.32 last week (and perhaps less this week), the airlines' response to
the drop in their largest single operating cost was to try and raise
their air fares again last week. The article's conclusion -
don't go looking for lower airfares anytime soon.
And how much have airfares increased
recently? Because some people change their flying habits when
airfares increase, the actual real world impact of an airfare increase
is often less than the numbers would imply if people continued to travel
exactly as before.
According to
this article, the real impact of the many increases this year seems
to be about a 10% increase in fares paid during Q2 this year
compared either to Q1 this year or Q2 of last year.
Well, okay. So if fuel costs are
dropping, and airfares are staying high, surely that means that, if
nothing else, the airlines will start to become massively profitable
again? This expectation is bolstered by the airlines' plans to
aggressively cut less profitable flights, and the increased loads on
flights.
But, again, apparently
not. The latest projection by IATA (the international airline
association) is projecting a $4.1 billion loss - and that's not for this
year, during which one could argue the airlines were trapped in an
unprofitable game of catching up with fuel costs for much of the year.
That's the projection for next year.
Why is such a massive loss expected for next year? This is a
question which begs an answer, particularly when one reads the fine
print and sees that this loss is based on an assumption that oil will
average an unrealistically low $95/barrel for the full year 2009 - and is there a single reader
here who believes that will be the case?
IATA says that weaker passenger demand will be the problem. But -
understand very carefully what they mean by 'weaker passenger demand'.
They don't mean that there will be a drop in passengers flying. Oh
no. What they mean is that there will be a reduced growth in
passenger numbers, and as proof of this, point gloomily to a growth of 'only' 1.9%, year
on year, in July this year.
So here's an industry where their largest single cost - fuel - is going
to massively reduce, and where they expect passenger numbers to
increase, and where airfares have also increased, but, in spite of all
these positive things, and in spite of their future best efforts in this
three-way positive environment - they are saying 'we're going to lose,
in total, $4.1 billion'!
That is bad management at a level that is impossible to comprehend.
It is even worse when you think that this $4.1 billion loss is
presumably after allowing for profits from airlines like Emirates and
Qantas, who could end up with the better part of $2 billion in profits
between just these two airlines alone. So the rest of the industry
might lose $6 billion.
The two unanswered questions continue, as always - how can an industry
as a whole lose so much money in what, in any other industry, would be
an enormously positive business environment; and, secondly, how can some
parts of the industry be extraordinarily profitable while their direct
competitors with similar costs are so extraordinarily unprofitable.
Remember - most airlines use the same planes, buy the same fuel at the
same prices, charge similar fares, and have not remarkably dissimilar
other fundamental business basics.
Surely the answer to this isn't something as
simple as bad to the point of grossly incompetent management?
Have you ever done an engine room tour, or a
kitchen tour, or a bridge tour while on a cruise? They are
interesting and a fun way to spend some time on your cruise. And
they're also usually free.
Well, the good news is that Princess Cruises
is coming out with a new ship's tour, which they are calling the
'Ultimate Ship Tour'. This will take passengers to visit the
engine control room, medical centre, print shop (hmm, a tour to a
shop....), laundry, photo lab (almost another shop), bridge, galley and
back stage at the theatre.
And the bad news? For this tour,
complete with 'shopping opportunities' I'm sure, you're asked to pay
$150 per person. The tour lasts a mere three hours, and you will
be given themed mementos at some of the places on the tour.
But - please! $150 for a three hour
ship tour of such compelling places as the laundry, photo lab and print
shop? Most off-ship tours, even at the outrageous prices cruise
ships sell them for, cost less than $150 for a full day tour, including
coach travel, possibly a guide and interpreter, and admissions to places
visited.
How can Princess justify $150 for a three
hour ship tour?
Some more mouth-watering train travel
innovation, with what will be the world's fastest high speed long
distance trains to be introduced in 2012 for services between Beijing
and Shanghai, slicing the 820 mile journey which currently takes about
ten hours down to four hours. The trains will have a maximum speed
of 380 km/hr or 236 mph. China started building an entirely new
set of track for the trains earlier this year, and while
this article has some fascinating details, it is silent about the
cost of this huge project.
China plans to have 7500 miles of high
speed train track operating by 2020. It currently has one
single short line between Beijing and Tianjin, some 200 miles in length.
The US has zero miles of high speed train track, and barring something
extraordinary, will still have zero miles in 2020.
This Week's Security Horror Story :
Yawn. We've escalated our national threat level for all flights to
High or Orange. This is the second highest of the five levels, and
is described as implying 'a high risk of terrorist attacks'. For
most of the period since 9/11, we have been at an 'Elevated' or Yellow
level, which is one level down from Orange, and which represents a
significant risk of terrorist attack.
Well, the good news is that eight years of
'significant risk of terrorist attack' have resulted in no successful
attacks. But what caused the threat level to be notched up from a
level that some people think was already way too high and now set at one
level less than the highest Red level?
The Homeland Security Department says
There is no credible, specific
intelligence suggesting an imminent threat to the homeland at this
time. Still, we are closely assessing potential threats and response
planning leading into and following the electoral process in 2008 to
2009. Heightened coordination and planning among intelligence
community and law enforcement partners is being undertaken solely
out of an abundance of caution, and focuses on preventive and
preparedness measures for the transition period between
administrations.
Hmmm - there is no credible specific
intelligence suggesting an imminent threat, but you still notch security
up to one level below maximum? This is sensible? Someone
should tell them the story of the boy who cried wolf.
If your flight is delayed or cancelled, or
you miss a connection, you might end up having to spend a night at an
airport somewhere, which is truly one of the most unpleasant experiences
known to mankind. Here's a
fun website that gives
you some helpful information if you need to sleep in an airport.
Lastly this week, airport 'service' and self
checkin hasn't yet got quite
this bad,
but perhaps it is only a matter of time.
Until next week,
please enjoy safe travels |