Q&A: United Mileage Plus chief discusses upgrades, award blocking

ByABC News
April 14, 2009, 7:21 PM

CHICAGO -- USA TODAY's Ben Mutzabaugh recently sat down with Graham Atkinson, the president of United Airlines' Mileage Plus frequent-flier program. Atkinson also agreed to take questions submitted by Today in the Sky readers.

Among the topics from today's installment, Atkinson addresses reader questions on upgrade policies and about whether United blocks some award availability on other Star Alliance carriers. This is the third part of our Q&A session; see below for links to parts one and two.

Ben Mutzabaugh:Speaking of United's frequent-flier partnerships, Star Alliance partner Lufthansa now owns a stake in JetBlue. Conceivably, could that create a scenario where United would have to cooperate in some way with JetBlue, a carrier that's clearly a rival for United? Do you know of any plans that Lufthansa might have to eventually bring JetBlue into the Star Alliance?

Graham Atkinson:As far as we know, there are no plans either to invite or for them to be interested in joining Star Alliance right now. They remain a vigorous competitor to us in the U.S. And, obviously, you'd need to speak to Lufthansa bout their investment in JetBlue and their plans in exploiting that, if you wish.

I would say that the entry requirements and the obligations on Star carriers are very clear. We haven't had any concern around what that might mean, in terms of any conflict of interest. Obviously, from a regulatory point of view, I'm not the right person to answer that. The questions as to whether there is technically a regulatory concern or not have been sort of aired by competitors and are being dealt with as we would expect by the DOT and the DOJ.

Mutzabaugh:For Continental frequent-flier members who will soon become part of the Star Alliance group, what elite benefits will they get? What will Continental's elite fliers be able to do when they book a ticket on United and vice versa? We've heard from many Continental elites asking about this.

Atkinson:Elite fliers on Continental will become Star Gold members in the Star Alliance. And as Star Gold members, they will earn EQMs (elite-qualifying miles) when they travel on United or other Star partners.

They will have over time, the functionality won't be in place from day one ... a product called "Star Alliance upgrade awards." They will certainly be part of that program over time, which is a program designed for high-yield economy fares to give them optionality of not only upgrading on themselves, but on other carriers as well.

They will also get priority boarding, priority check-in (and) priority security where we offer that at key airports. They will get what we call Star Alliance privileged status. So they will get that on United. They will get access to lounges on us and (throughout the Star system). So they will get all the privileges that a ANA customer or an Air Canada customer gets on United.

Mutzabaugh:That leads to another question from a reader who has Star Alliance Gold status. The reader's question is: "We used to automatically be upgraded to Economy Plus seats, but now we have to pay for them." That's obviously a change for Star Gold customers. Any chance for back-tracking on that? Or, if not, what's behind that decision?

Atkinson:The rationale behind that decision was essentially part of the creation of our "Options by United" programs and products. We identified an opportunity and an interest by customers who were loyal to United, but maybe didn't fly enough to (earn) Premier (status) or above and therefore get privileged access into it at no extra charge. We felt it was a good business decision for us. It's become a very interesting revenue stream.

(Economy plus has been) highly popular, by any measure, with people who are United loyalists. And that caused, obviously, some dynamics in terms of prioritization and ability to get access to that cabin. At that time, we actually made the decision that the Star Gold get a range of benefits in EQMs and (other) privileges when they travel with United.

United Economy Plus is a peculiarly unique product to United, among which we felt was genuinely earned by United customers earned or available to United customers. So, it was as seen by a US Airways member a takeaway. Obviously, they still have the ability to access it by paying $30 or $40 or whatever the fee is on the day (of travel), but it really was a prioritization issue. And I don't think that anything that's happened since has made us believe that that prioritization wasn't right. (But) I understand their frustration having to now either pay for it or lose it as a right (of elite Star status).