Fees make it harder to com­pare fares

Air­lines want to use trav­el­ers’ per­sonal data to sell tai­lored ser­vices, rais­ing ob­jec­tions.

Austin American-Statesman - - BUSINESS - JOHN FITZHUGH / SUN HER­ALD

WASHINGTON — For many pas­sen­gers, air travel is only about find­ing the cheap­est fare.

But as air­lines of­fer a pro­lif­er­at­ing list of add-on ser­vices, from early board­ing to pre­mium seat­ing and bag­gage fees, the abil­ity to com­par­i­son shop for the low­est to­tal fare is erod­ing.

Global distri­bu­tion sys­tems that sup­ply flight and fare data to travel agents and on­line tick­et­ing ser­vices like Or­b­itz and Ex­pe­dia, ac­count­ing for half of all U.S. air­line tick­ets, com­plain that air­lines won’t pro­vide fee in­for­ma­tion in a way that lets them make it handy for con­sumers try­ing to find the best deal.

“What other in­dus­try can you think of where a per­son buy­ing a prod­uct doesn’t know how much it’s go­ing to cost even af­ter he’s done at the check­out counter?” said Simon Gros, chair­man of the Travel Tech­nol­ogy As­so­cia- tion, which rep­re­sents the global distri­bu­tion ser­vices and on­line travel in­dus­tries.

The harder air­lines make it for con­sumers to com­pare, “the greater op­por­tu­nity you have to get to higher prices,” said Kevin Mitchell, chair­man of the Busi­ness Travel Coali­tion, whose mem­bers in­clude cor­po­rate travel man­agers.

Now the Obama ad­min­is­tra­tion is wad­ing into the is­sue. The De­part­ment of Trans­porta­tion is con­sid­er­ing whether to re­quire air­lines to pro­vide fee in­for­ma­tion to ev­ery­one with whom they have agree­ments to sell their tick­ets. A de­ci­sion orig­i­nally sched­uled for next month has been post­poned to May, as reg­u­la­tors strug­gle with a del­uge of in­for­ma­tion from air­lines op­posed to reg­u­lat­ing fee in­for­ma­tion, and from the travel in­dus­try and con­sumer groups that sup­port such a re­quire­ment.

Mean­while, Spirit Air­lines, Al­le­giant Air and South­west Air­lines — with back­ing from in­dus­try trade as­so­cia-

tions — are ask­ing the Supreme Court to re­verse an ap­peals court rul­ing forc­ing them to in­clude taxes in their ad­ver­tised fares. The ap­peals court up­held a Trans­porta­tion De­part­ment rule that went in ef­fect nearly a year ago that ended air­lines’ lee­way to ad­ver­tise a base air­fare and show the taxes sep­a­rately, of­ten in smaller print. Air­lines say the reg­u­la­tions vi­o­late their free-speech rights.

At the heart of the de­bate is a de­sire by air­lines to move to a new mar­ket­ing model in which cus­tomers don’t buy tick­ets based on price alone. In­stead, fol­low­ing the well-worn path of other con­sumer com­pa­nies, air­lines want to mine per­sonal data about cus­tomers in or­der to sell them tai­lored ser­vices. You like to sit on the aisle and to ski, so how would you like to fly to Aspen with an aisle seat and a movie, no ex­tra bag­gage charge for your skis, and have a ho­tel room and a pair of lift tick­ets wait­ing for you, all for one price? You’re a fre­quent busi­ness trav­eler. How about pri­or­ity board­ing, ex­tra legroom, In­ter­net ac­cess and a ren­tal car when you ar­rive?

“Tech­nol­ogy is chang­ing rapidly. We are go­ing to be part of the change,” said Sharon Pinker­ton, vice pres­i­dent of Air­lines for Amer­ica, which rep­re­sents most U.S. car­ri­ers. “We want to be able to of­fer our cus­tomers a prod­uct that’s use­ful to them, that’s cus­tom­ized to meet their needs, and we don’t think (the Trans­porta­tion De­part­ment) needs to step in.”

If air­lines have their way, pas­sen­gers look­ing for ticket prices may have to re­veal a lot more in­for­ma­tion about them­selves. The In­ter­na­tional Air Trans­port As­so­ci­a­tion, whose 240 mem­ber air­lines cover 84 per­cent of global air­line traf­fic, adopted stan­dards at a meet­ing this month in Geneva for such in­for­ma­tion gath­er­ing by air­lines as well as by travel agents and tick­et­ing ser­vices that would re­lay the data to air­lines and re­ceive cus­tom­ized fares in re­turn.

Con­sumer ad­vo­cates ques­tion how air­lines would safe­guard the per­sonal in­for­ma­tion they gather.

“It’s like go­ing to a su­per­mar­ket where be­fore you get the price, they ask you to swipe your driver’s li­cense that shows them you live in a rich ZIP code, you drive a BMW, et cetera,” Mitchell said. “All this per­sonal in­for­ma­tion on you is go­ing out to all th­ese car­ri­ers with no con­trols over what they do with it, who sees it and so on.”

The air­line as­so­ci­a­tion said con­sumers who choose not to sup­ply per­sonal in­for­ma­tion would still be able to see fares and pur­chase tick­ets, though con­sumer ad­vo­cates said those fares would prob­a­bly be at the “rack rate” — the travel in­dus­try’s term for full price, be­fore dis­counts.

Christ­mas trav­el­ers wait at Gulf­port-Biloxi In­ter­na­tional Air­port in Gulf­port, Miss. Air­lines want pas­sen­gers to give more per­sonal info to cus­tom­ize ticket prices — likely to be higher.

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