United is once again “enhancing” its frequent flier program, Mileage Plus. My first thought was, “Oh no, here we go again.” I immediately flashed back to American’s rollout of one-way awards — which killed one of the best award ticket features, the free stopover.

With United, it’s actually a better proposition, on the whole. Don’t get me wrong: It’s a good news/bad news scenario. But on the whole, it’s better than AA’s offering.

The program changes actually incorporate two new policies: Cash+miles tickets, and one-way awards.

• Good: Cash+miles options
  United is offering a “Miles and Money” option, so a smaller mileage balance can be supplemented with cash. A nice option for flexibility.
• Not so good: Availability and fees
  However, it’s not available on every flight (“select flights”). I ran a few searches, and there was no cash-supplement option.

  Note also that you’ll be responsible for more fees (like airport passenger facility fees) which aren’t typically charged for tickets paid 100% with miles. So the cost for the Miles and Money option will be more than just the cash fare paid.

  The complete rules are here.

• Good: One-way awards
  One way awards are a great feature, especially if you’re traveling to a city that’s serviced by another airline that offers a similar award structure. (Say, fly one-way there on AA, and one-way back on UA.) United is making one-way awards available only via united.com, and you can only book flights operated by UA (no codeshares or partners). The one-way redemption chart is here. (pdf)
• Not so Good: The threat to stopovers
  Booking a ticket on entirely UA metal can no longer include a complimentary stopover. Each leg will need to be booked separately, as a one-way segment. This will drive the number of miles required higher. But this shouldn’t be a big concern for true stopover buffs. For example, if I were to fly from New York to Paris, spend a few days there, then fly on to Istanbul, and eventually return, that would have to be booked using a Star Alliance ticket. Those ticketing rules appear unchanged. But all-UA award itineraries — already less desirable than most Star Alliance partner flights — will be even less desirable. And I worry that Star Alliance tickets are next…

On the whole, this really does strike me as a program enhancement. Perfect? No. But I’m not going to complain.

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Looking at the chart, does it surprise you that United Airlines announced today that it was increasing its checked baggage fees from $20 to $25 for the first bag? And from $30 to $35 for the second? ($23 and $32, respectively, if you prepay online.)

In the past few days, United has joined Delta, US Airways, and Continental in raising the baggage fees. The United policy goes into effect tomorrow (Thursday, January 14) for flights on or after January 21 within region 1 (North America, Hawaii, Caribbean).

For all the public’s (and my own) bitching and whining about the proliferation of fees, this stock chart really says everything you need to know about why these fees continue to proliferate. Wall Street likes these fees, as they generate a steady stream of revenue. “Free money,” they say. Never mind that the same customers who today are coughing up the money for these fees might be migrating to another carrier (like Southwest) if they can manage it. But Wall Street short-term thinking is what’s driving this. And the increase in these airlines’ stock prices today — that’s the CEOs’ vindication.

Downgraded: Upper Class, upstairs, on Virgin Atlantic
Upgraded: Economy Class, upstairs, on Virgin Atlantic
Like many airlines, Virgin Atlantic has been cutting seats in business class, in response to the economy’s woes. But the upstairs section of the 747 has always been sacred space for the premium-cabin travelers. Until now. The airline will slowly roll out “configuration 4,” which moves some regular economy seats to the back of the upstairs cabin. Virgin Atlantic Upper Class loyalists will object to the lack of exclusivity. Which, in turn, should be an improvement for economy customers who get the service boost of a small cabin.

Upgraded: Consumer rights for “mistake” fares
As I’ve argued in the past, it’s sometimes impossible to know if a low fare is an error, or just a deal. (1 cent fares, anyone?) So I’m pleased to read that, in the U.S., the federal government is warning airlines that they’re (at least partially) on the hook for mistake fares. The DOT ruled: “We believe that all airlines should accept some responsibility for even the erroneous fares they publish.” Customers with canceled tickets must now be “made whole,” though this doesn’t mean that tickets will be honored. Still, a good move.

Downgraded: TSA’s mad redacting skillz
Seth, over at the Wandering Aramean has been digging through a document detailing the TSA’s standard operating procedures. The document was redacted, but Adobe Acrobat doesn’t delete the text hidden behind the black boxes. Oops. Now the TSA says the policies were never implemented, after all. (Then why were they posted, and redacted?) Seth has links to the original documents on his site.

Upgraded: Continental systemwide upgrades for top-level elites
In a further alignment of Continental OnePass with United MileagePlus, Continental is systemwide upgrades and a double-secret invitation-only ultra-elite level for high-spend elite frequent fliers.

Upgraded: United’s long-range aircraft… eventually
After slicing and dicing their fleet over the years, and recently killing off their 737s, it’s finally time for United to look at renewing their fleet. They’re ordering 25 Boeing 787s and 25 Airbus A350s, which will replace their 767s and 747s, respectively. …in 6 to 9 years.

Upgraded: The importance of champagne to Singapore Airlines
“Singapore Airlines Ltd. cut Chief Executive Officer Chew Choon Seng’s salary by 20 percent and parked planes in response to a global travel slump. It didn’t touch the S$11 million (US$8 million) it spends annually on wine and Dom Perignon champagne for first-class passengers.” Fewer planes, but constant wine budget? Say no more.

Upgraded: Clarity on what’s legal in seatback pockets
Remember the semi-secret FAA rule that banned personal items in airline seatback pockets? Last week, Henry Harteveldt tweeted that the FAA had clarified its policy. The entire policy is printed here. The short version: You can keep up to three pounds of stuff in the pocket, presumably including the SkyMall magazine, etc.

Upgraded: United Airlines
It takes a trip to the bottom to warrant an improvement, it seems. United, having peered into the abyss, has announced that they’ll be revamping their aircraft interiors (say goodbye to the “tequila sunrise” decor!) and airport lounges.

Downgraded: Aer Lingus’ Irish-ness
Ireland’s Aer Lingus has applied for an operating license in the UK, which, if granted, would enable the company to relocate its official base of operations to Britain. The reason: A labor dispute with Irish pilots and flight attendants, who are resisting a pay cut. Expect strikes if this goes through.

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In October, United announced that they were moving to an “unlimited” upgrade system from their electronic certificate system. But as readers chimed in, one of the biggest complaints came from top-tier 1K members. The quarterly allotment of confirmed upgrades within North America was going away, and with that, a big perk of upgrade security.

United must have gotten a lot of complaints, as they’re reinstating the so-called “regional” upgrades:

1K® members will continue to earn Regional Upgrades
Sometimes no change is good news. After our last announcement, we heard from our 1K members how much they value their Regional Upgrades. To thank them for their ongoing loyalty, we’ve decided to continue issuing Regional Upgrades to 1Ks, even after the Unlimited Domestic Upgrades program launches.

That gives top-tier elites the best of both worlds: A reserved upgrade if booked in advance (and if United releases seats for upgrade early…) and the top of the free-upgrade list if they’re sweating it out at the gate.

And entry-level elites don’t really lose anything here. The 1Ks would be ahead of them in line, anyway.

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Separately, United and Continental announced that reciprocal “unlimited” upgrade privileges will roll out in mid-2010. No word yet on what the hierarchy will be; I assume that, in a tie, UA 1Ks will still outrank CO platinums…

And on the semi-upgrade front: Continental elites will also have free access to the Economy Plus section on United flights — a privilege which United hasn’t been extending to other Star Alliance partner travelers.

Upgraded: Your ability to earn lots of British Airways miles
Chase and British Airways have launched a pretty amazing airline mileage-earning credit card offer. 50,000 BA miles after one purchase, then 50,000 more after spending $2000 within three months. Gary Leff has thought this through and come up with a scheme for 420,000 miles between two people. That’s a lot of free tickets for a $75 annual fee.

Downgraded: Track suits
A Best Buy executive says that United refused him an upgrade because he was wearing a track suit. “United says there is no passenger dress code, but they cited two rules. Ticketed passengers can not be barefoot and must be clothed.” Standards!

Upgraded: Fees for Expedia phone bookings
Expedia announced that it was dropping the booking fees it charged for booking any flight, car rental, hotel or cruise on the phone. As online agencies compete to attract customers, this is the latest fee to drop. Yay, lower fees! Priceline immediately tweeted that they had never had phone booking fees. Nyahh.

Upgraded: Responsibility for rental car reservations
Avis Budget Group has worked with global booking systems to prepare their networks for an eventual introduction of no-show fees for car rental bookings. Frankly, I’m amazed that this is a fee that hasn’t been enforced more widely already.

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You may remember Dave Carroll from music videos decrying the state of United Airlines customer service. But the airline keeps finding ways to inspire new songs:

After famously breaking his guitar, United Airlines has managed to cause further trouble for David Carroll by losing his luggage — just as the Canadian singer-songwriter was en route to deliver a speech about customer service.

You can’t make this stuff up.

There have been two videos so far, both decrying United’s baggage handling and subsequent customer service. Personally, I thought that Carroll’s first video was his best. The second was okay, but felt like it was trying too hard, and didn’t add much. Yes, the third video in the trilogy is basically writing itself now.

(Thanks for the heads-up, John!)

United Airlines announced yesterday that they were revising their upgrade program within Mileage Plus. The headline is going to sound great — “unlimited” upgrades — but the reality is that this downgrades the United program (further). It’s a downgrade of the upgrade.

What United is doing is eliminating the 500-mile electronic certificates and the regional-upgrades. (International systemwide upgrade certificates for 1K travelers are unchanged. Upgrades booked with miles, which will soon carry a cash copayment, are otherwise unaffected by these changes.)

Instead, all travelers with any elite status will be automatically eligible for an upgrade. Some implications for the changes:

• If you’re an entry-level elite (Premier) you’re not going to upgrade much. Previously, a Premier Executive or 1K would have to request an upgrade and offer up some certificates, but now those elites will automatically jump ahead of the Premiers. If you live in a city with a lot of United elites (Chicago, San Francisco, DC, Denver, for starters…) and you’re “just” a Premier, say adios to hot nuts.
• If you’re a 1K flier, you’re in good shape for shorter flights where you might not have otherwise bothered cashing in your upgrade currency. You’ll be at the top of the list for those short hops from Washington to Providence. Par-tay!
• But… 1Ks give up some security. The e-certificates that allowed upper-level elites to reserve upgrades at booking are kaputt. Adios, sure thing!
• Flights on “p.s.” service between New York/JFK and LAX or SFO are excluded from the “unlimited” upgrades. This is obnoxious — you’ll have to use miles or systemwide upgrade certs to move from economy to first? Puh-leeeze.

Within minutes of the announcement, Gary Leff and lucky each weighed in on the change. Neither of them found it to be an improvement. Read ‘em both for more critique.

Reader mail also started pouring in. And none were happy. A few excerpts:

Don writes:

“Unlimited”? My a**. I’m a Premier living in Chicago and flying mostly short hops. I guess I’ll be in Economy Plus forever. Hello American?

Taylor writes:

So they take away my confirmed-regional upgrades and make it a lottery? How is this an improvement?

Antonio writes:

This is genius marketing on United’s behalf, because on the surface it sounds like a fantastic proposition. UNLIMITED UPGRADES!!! But in reality, what they’re doing is cutting a program that gave upgrades earlier, allowing the airline more time to keep those seats free to possibly sell them to a paying customer.

SA nails the reason for making the change:

So Continental joins Star Alliance, and United is turning Mileage Plus into OnePass. At least there’s consistency across the North American partners.

And Tino sums it up:

So United wants to encourage gambling, instead of rewarding loyalty. Maybe their call center should merge with the 1-800-GAMBLER helpline.

In the end, Antonio’s objections noted, top-tier elites are the ones who come out looking best-of-the-worst in this new scheme. As you move down the totem pole, you’re less and less likely to benefit. And that, perhaps, is the point. United is rewarding its highest-spenders. But it’s harming its mid- and lower-tier spenders. And that seems like it could hurt them in the long run.

This leaves only American Airlines using the certificate-based method of reserving upgrades (for Gold and Platinum AAdvantage members). It will be interesting to see if low- and mid-tier United elites start defecting to American, or if American will join the rest of their peers in going “unlimited.”

United Airlines, continuing on its quest to sell everything that isn’t bolted down, is rolling out a new way to check your bags: A $249/year subscription. And perhaps counterintuitively, I actually like this fee.

That is, I “like” this fee within the context of existing checked-baggage fees. Had that line not already been crossed, I would have been firmly opposed. But baggage fees are reality in American airspace, alas. (Southwest is still fee-free; JetBlue charges $20 for the second fee, but nothing for the first. Reward good behavior if you can.) But if you’re flying United, and you can’t fly with carry-on alone, then you’re looking at a fee.

And some — just some — people who would be paying that fee might benefit from this new program.

Dubbed Premier Bags, the deal will particularly appeal to tour groups on the same itinerary, or to a large family with lots of bags:

With Premier Baggage, you and up to eight companions traveling under the same confirmation number can check up to two standard bags each without fees, where applicable, every time you travel within the United States or internationally on United® or United Express® operated flights during the year.

The purchase of a Premier Baggage annual subscription does not waive fees that would ordinarily be assessed for oversized and overweight bags and does not cover the cost of checking more than two standard bags.

The deal seems better suited to large parties than to an individual who takes multiple trips. Since you pay $20 for the first bag and $30 for the second, an individual would have to take 5 trips with the full complement of two bags each just to break even. (Or, if you’re able to plan ahead and pay for your checked bags online, you get a $5 discount per bag. In which case even 6 trips with two bags each don’t quite break even.) Depending on your itineraries, you could be at Premier status before completing your five or six trips — after which you’d pay nothing for checked bags.

What concerns me is the phrasing: “introductory price.” If this is a trial balloon, then look for the price to go up to $299 or higher. It might — might! — still be a value for some people at that price, but that number of people will grow smaller and smaller.

So how does the $249 subscription grab you? Hit the comments.

United has rolled out an enhancement to their Mileage Plus frequent flier program: You’ll now be able to book hotels, rental cars, or packaged hotel/car combos using your mileage balance.

United has tested this sort of thing in the past, but only for their elite-level Mileage Plus members. The new program allows all members to redeem miles this way.

On the surface, this is a good thing, which is how the majority of the media are bound to spin it. More redemption opportunities are a good thing, clearly. The selection of hotels and car companies isn’t seemingly limited by proprietary side-deals and exclusivity arrangements. And there aren’t blackouts, which is nice. But simply having another place to spend your miles isn’t a huge improvement if the cents-per-mile value proposition stinks.

And yes, the value proposition stinks.

The FAQ’s don’t list the conversion rates up front, but open up a few new browser windows, run a few parallel hotel and car searches, run the math, and we’ve got our answer: about 0.75 cents per mile.

The 0.75 cents per mile number assumes that the cash-booking would be done with the supplier directly, with full cancellation possible. Which isn’t fair, since the United bookings aren’t cancellable. Changes incur a $35 fee.

So not only do you have harsher terms, you even get LESS than 0.75 cents per mile if an agency or consolidator offers a lower price for the same dates. In one test, I found night at the Intercontinental Boston in October that goes for 42,725 miles on the United site. The hotel chain’s own site has a rate of $329 a night for a cancellable reservation (0.77 cents/mile). Prepaid costs $297 (0.70 cents/mile).

If you’ve got more miles than you know what to do with, or the last thing you want to do is cash in miles for more travel, then this might be for you. But if your mileage balance is more down-to-earth, you’ll probably want to try spending your miles on travel — particularly long-haul travel in premium cabins — before you empty the piggybank for a rental car.

Related:
- Is Starwood Preferred Guest’s “SPG Flights” a game-changer?
- Cashing in miles, but not on flights
- Reader mail: What kind of point-earning credit card is best?
- Reader mail: Can I cash in miles for magazines?