How credit card merchant fees could change the face of air travel

— -- Business travelers may be the ultimate losers in the latest scuffle between airlines and travel agents over credit card fees. United Airlines recently notified a handful of agents they can no longer sell United tickets using the airline's credit card merchant agreement.

Merchants typically remit 2% or 3% of the purchase price to the credit card company for the right to accept that credit card as a form of payment. "Merchant fees" are contractually based on the purchase price and transaction volume for each merchant. Airlines have traditionally paid those merchant fees.

Though airlines are slashing costs and unbundling services formerly included in the price a ticket to survive, United is quick to reiterate that their action impacts a relatively small number of travel agencies. However, United spokesperson Robin Urbanski Janikowski also says "costs of distributing our services are significant and we will continue to reduce these costs while we run an efficient airline for our customers."

This leads many travel agents and corporate travel managers to believe this is only the beginning. "It is going to be a fee that will be passed on to all travel agencies eventually," projects Randy Limbacher, president of Canyon Creek Travel American Express, based in Richardson, Texas.

"Certainly, they are testing the waters to see if the other carriers will join in and also promote this initiative," says Michelle De Costa, the global travel manager for Sapient Corporation. "When Delta Air Lines was the first airline to cut commissions, basically everyone followed suit," De Costa adds. "They are going to do it with some select agencies that probably don't sell a lot of United and just see what the marketplace will bear."

De Costa wrote to United's chief executive officer, Glenn Tilton, to express her company's concerns. "I know that other travel managers have sent similar notes to United or other airlines to indicate their dissatisfaction with this new initiative," De Costa told me.