Make Airline CEOs Fly Coach


If you heard this from those who run the "grand old airlines" — legacy carriers like American, Continental, Delta, Northwest, United, and US Airways — what would you suppose they were talking about?

"Hate it!"


"Absolutely despicable."

If you guessed soaring fuel prices, you'd be wrong (though of course, they do hate that). No, what I'm talking about is the longtime, everyday enemy of the big boys: the Internet.

Long before oil became the bogeyman of the airline industry, the Internet started killing off profits. Let's go back to the mid to late '90s when some clever people at Microsoft noted that Internet + travel = $$$$ and set in motion the whole shop online for cheap airfare process that allows consumers to compare dozens of prices instantly.

In the old days, who noticed if one airline charged a few bucks (or many bucks) more than a rival? But, they can't get away with that anymore; the rise of de-regulation has spawned lower cost airlines like Southwest and JetBlue that use the Internet to shamelessly flaunt their cheap fares.

And, thanks to the Internet, passengers have been able to take control when it comes to getting great deals. In effect, we have become our own travel agents, and for the most part we like it.

Or we did. Before fuel prices starting going insane.

Now there are fewer deals, and fewer airlines — leading to a brand-new parlor game: Guess Which Airline Will Go Bankrupt Next? And that is leading some people to advocate a new solution to the airline woes: Dump de-regulation. Let Uncle Sam take the reins, and make Internet air travel shopping a footnote in commercial aviation history.

That is what former American Airlines CEO Bob Crandall wants to do. He was the recent subject of a Business Week piece titled, "How I'd Save the Industry" and he advocates a return to government regulation — albeit in a "kindler, gentler" form where bureaucrats set airline ticket prices to assure profits for the big airlines while erecting barriers for new startups to jump into domestic air travel.

The point of deregulation was to let the free market rule. And if bringing air travel to the masses is any indicator of success, deregulation has been a resounding triumph as almost 300 percent more airline tickets were sold in 2007 than before deregulation with only a 25 percent growth in population.

So what now, a return to the days where flying is for the rich? And that will solve everything? I don't think so. All it would do is guarantee fewer people in the air, though it would assure profits for the older airlines. And the passengers would get what out of this?

Every day on my blog, I chat with fliers all over the country (and the world), and they all say they long to get to their destinations as quickly and painlessly as possible, or they absolutely need to do this (the road warriors among us). And you might be surprised at how many of them say, "Yeah, we'd be willing to pay a premium for that." I mean, if you could hop into Captain Kirk's transporter room and get beamed to Las Vegas and back with your person and luggage intact — every time — wouldn't you pay more?

But are you willing to pay stiff re-regulation prices? And I'm not talking about paying substantially higher prices for an exhilarating Beam me up, Scotty experience; I'm talking about paying those prices for the abysmal flying experience we get today.

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