Why the airlines and movie studios are being dumb

Those of us who have grown up with the Web take it almost for granted in thinking that its content is an exponentially upward curve: every second it seems there are new blog posts, hours of video uploads, and Tweets galore. But we start the new year off with a big downturn in content. I never thought I would say this, but we aren’t better off as a result.

There are two places where this is happening: on the travel booking sites and with Netflix. Both aren’t good for consumers, and both leave a bad taste of things to come.

Let’s look first at a new round of online airline fare wars. American and Delta have removed the ability to book travel on several travel Web sites, in the interests of trying to get travelers to come back to their own portals and save on paying booking fees to the likes of Expedia and Orbitz. It is a wrong-headed and dumb move, to be sure.

Do you have déjà vu all over again? Many years ago, the Justice Department sued American over how they displayed their flights on their own online reservations service called Sabre. Back then. the only people that used that service were travel agents. The DOJ claimed it was anti-competitive, since the agents would often pick whatever fares and flights were offered on the first screen, and – surprise – it was oftentimes American flights rather than their competition. Now we have to fight this battle all over again.

To American and Delta, you have my total scorn. It is bad enough that you want to nickel and dime me on the bags I seldom ever check, the lousy excuses for meals that I never count on, and the paucity of flights that come into St. Louis. And the ridiculous change fees, too. (Delta’s is $150 now!) At least you don’t charge $5 for using my own headset anymore, not that many flights that I am on actually have any movies showing. And all of this so I can become more loyal to buying my tickets on AA.com? No thanks.

The airlines are now experimenting with Facebook portals and beefing up their own Web sites to collect more money from you once you actually book your ticket. On a trip on Atlanta, I had to pay extra to sit in the exit row, which was a new one on me. Soon, completing a booking will require you to have your lawyer reading the fine print over one shoulder, and your accountant adding up the extra fees over the other one.

So here’s how I build my loyalty: I fly Southwest. They don’t charge to reticket, they don’t charge for bags, and they don’t attempt to try to feed me. I call them the airline of diminished expectations, but at least they can turn a plane around in 20 minutes and get me to my destination. Plus their rewards program actually can deliver free flights without my having to book them a year in advance to someplace that I actually want to travel to.

So for those airlines that are making it more expensive and complex to fly, I say to them: I will take my business elsewhere. Southwest understands me, and while it does seem as if I am on a flying bus, they treat me with respect, humor, and a level of service that is missing from their competitors.

What about Netflix? While the major studios haven’t yet pulled their content from the popular service, they realize that they gave Netflix the rights to their films too cheaply, and now are contemplating very high licensing fees when these contracts come up for renewal.

As more folks use Netflix’ streaming service to watch movies, the studios are reading from the recording industry playbook and getting nervous. Too bad we have all seen how this movie ends: people will get their content illegally if pushed hard enough. The top story in USAToday yesterday was about folks cutting cable TV and replacing it with Netflix and Hulu streams and buying a good quality HD antenna to get the dozen or more local digital channels. This isn’t something that only Wired subscribers care about, especially as monthly cable bills hit the three digits.

Sure, the studios are in business to make money from their content. If they want to sock it to Netflix and try to get more in licensing, that is their right. But if I don’t want to pay $20 to see a first-run movie, that is my choice too. Again, not a good way to build customer loyalty by charging more for less access.

Both the airlines and the movie studios will eventually learn from these mistakes. It is just a matter of time.


8 thoughts on “Why the airlines and movie studios are being dumb

  1. Generally agree with your thoughts here, but Southwest has not been part of Orbitz, Expedia, or other third-party travel sites all along. So why is it any different if American and Delta follow this same practice? While I don’t think it’s positive for those airlines, it hasn’t stopped–or hurt–Southwest.

    • True, but at least with Southwest you knew that the fare you booked was the absolute lowest, just because their system was simple to navigate and use.

      For a perspective from the airline industry, check out this press release. You have some rough going with the industry double-speak, but it is worth seeing their POV.

  2. David,
    Once again, you nailed it. You clearly voiced why I heart Southwest and why my “A-List” card is my wallet’s favorite. For anyone who travels often, I can’t understand how having an assigned seat can be considered an adequate trade off for bag charges, change fees, and snooty flight attendants. Keep up the good posts!

  3. Great column. My favorite Delta bit of idiotic behavior is advertising their credit card by telling you they don’t charge you for baggage if you have one. Southwest doesn’t charge you even if you, heaven forbid, pay cash!

  4. I support Alaska/Horizon for the same reasons you support Southwest (our dinky airport can’t take full-size planes, so sadly SW won’t be coming here). Plus they offer a featured local beer and wine for free on all flights :-). I have also gone back to using a travel agent for flight bookings – I have a great agent that gets me better rates than Orbitz ever did, plus she actually does sort out problems. I’m not even going to start on Delta, who (presumably because it made more $$ for them) loaded cargo onto a recent 17-hour flight back from South Africa instead of passengers’ luggage – and didn’t tell us until after we landed in Atlanta and had been standing around the baggage carousel for half an hour …

  5. Hey David – First, happy birthday! Second, if you want to know ‘greed’ St. Louis’ airport isn’t the first place to start. Neither is SABRE. Try UseLess Air: 1st in the country for crapping on – not just consumers – but a whole town. Pittsburgh built one of the best airport facilities and runways in the world – literally – for them and what did they do? They high-tailed it to Philly, worse city on record for arrivals, departures, not to mention, lost luggage. Oh, and Delta just announced Pgh to Boston flights starting later this month. That means a search through, at least, the following to compare prices: JetBlue’s site, Southwest (which goes into neighboring airports), USA, United, and now Delta. Glad I’m off the weekly back and forth commute that I did for two years. My heart goes out to you with your itinerant lifestyle. Now, blow out the candles. (Call if you need help 😉

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s