Shift To Market Share Measures Could Corrupt Agents

While others like Kevin Mitchell and my respected colleague Andy Menkes may herald Delta's recent move toward revenue share measurements as a playing field leveler (BTN, March 25), I see it as the beginning of another era of self-destructive market share competition and probably increased costs to buyers. Essentially, what will ensue is a situation of "house" agencies that get paid off for giving more than deserved share to their patron airlines. This will damage such airlines as Southwest, American Trans Air, Frontier and AirTran that cannot expect to sign up any house agencies because of their limited worldwide coverage. Agencies will become semi-permanent prostitutes, as some are today. Of course, the only way for an agency to increase its airline-derived revenues is to switch to the highest bidder after riding with one airline for a year or so.

What I also fear is that this marks a new period of less than full disclosure. Because no industry commission standard exists, agencies will be inclined to underestimate their airline pay when dealing with clients, and agency services will thus cost more. What about CTDs? Will they have to become economically enslaved by big airlines just as their cousin agencies are? Will the airline oligopoly get smaller? What about the strong regional agency that has managed to survive through all commission cuts? Will it also have to succumb to prostitution? I see no safeguards for corporate accounts in this situation. In my forecast for 2003, I will expect to see average business air travel costs rise by 10 percent to 15 percent, despite corporate efforts to keep travel to a minimum. I know mine is the view of a contrarian, but, from a moralistic perspective, corrupting intermediaries is not the way to assure value in air transportation.

Rolfe R. Shellenberger

Runzheimer International

A Different Take On 'Take On'

We read your TechBriefs (BTN, April 22), in which you mentioned the global agreement between Amadeus and AirPlus. We are very happy that you have told your readers about the deal, but the last phrase, "In Germany, the partnership will take on Frankfurt-based I:FAO," contains an error that is very important because it changes the whole context. I:FAO is not our partner in this deal. I:FAO is a competitor of AirPlus. Correct is that in Germany, an additional joint agreement has been made with Start Amadeus and AirPlus.

Florian Graenzdorffer

Lufthansa AirPlus Servicekarten GmbH



Editor's NoteThanks for your note. What we have here is a language issue. It is an American colloquialism to say "take on," meaning "compete with," but we can understand how "take on" also could be interpreted as "partner with." It's a lesson reminding us that we have an increasingly global audience.