Weekly roundup Friday 1 October 2010

Askformoneyb Good morning

Sincere thanks to everyone who responded in the first week of this year's fundraising drive.  You are even more special this year, for two reasons.

First – the good news – the first week's contributors this year were appreciably more generous than the first week's contributors last year, in terms of individual contribution level.  Thank you very much indeed for your great generosity.

Special thanks in particular to Pete R, Bryan G, Lila D, Jim J, Lynn L, Beverly B, Bill W (hmmm – does that mean I'm now 'a friend of Bill W'?), Kathy H, Roger L, Neal S, Steve K, and Frank S, for becoming 'super supporters'.

Second, the, ahem, other news.  You are also more special this year because there were, sadly, significantly fewer of you than last year.  We have had only 65 readers respond so far.  Last year we had 146, the year before 215, and the year before that 205.

On the other hand, last year's slow start ended up with a record breaking 909 readers in total, so I'm not closing up shop in despair just yet.

Instead, I've decided that the thing to do is to offer you something in return, and with that in mind, have created a mammoth 10,000+ word Buyer's Guide to iPad and Tablet Computers which will be given free to all readers who contribute $5 and more.

But wait - there's more.  I've also created a spreadsheet that will help you compare different tablet alternatives, and which will even calculate the respective suitability of different options (using numerical scores you can set yourself if you wish).

If you're looking for a tablet at present, or even if you're thinking you might start looking for a tablet soon (analysts project sales of 50 million tablets next year), you need to download this complete report now.  Tablet specifications and pricing (and brands – 23 or more manufacturers have announced plans to make tablets so far) are all over the board, and there are plenty of traps for the unwary.

An iPad costs anywhere from $499 to $829.  I've bought two, and in both cases, regretted the choice I made.  If nothing else, this report will help you learn from rather than repeat my mistakes ($1328 in total).  If nothing else, an investment of 1% (or hopefully slightly more!) of the purchase price of an iPad – less than most iPad apps cost – will help you to choose wisely and confidently.

Plus, this report isn't just about the iPad. It is about all the other tablet devices that are starting to burst out into stores and online, too.  The report covers more than 50 different factors you need to evaluate when making a fully informed best decision about the ideal tablet device.  Maybe you shouldn't get an iPad at all.  Maybe one of the other devices is a better solution.

Just as the iPhone first created a new market all for itself, and then dominated it for a while, before now dropping down and being overtaken each month by Android phone sales, we predict the iPad's initial super-nova burst of marketing glory will surely be eclipsed by the steady inexorable development of Android tablet competitors (and possibly other OS based tablets too).

Please, whether it be for the iPad/tablet buying guide, or just to help out in general, do consider becoming a Travel Insider supporter.  Your support is truly needed; your support is what preserves my independence and my ability to 'tell it like it is', to name and shame where appropriate, and to do so without any commercial concern or constraint.

You can help by simply clicking here and then choosing one of the Paypal/credit card payment options.  Your wallet will be quickly and securely lightened, as you select, at the speed of electronic communication.  Giving has never been easier.  🙂

Please choose to participate in and help protect the longevity of The Travel Insider, shortly to enter its tenth year of operation.  We're here for the long term, and we gain more credibility and clout with each passing year, in part because our voice is magnified by your tangible support.  We're not a self-appointed 'talking head', we're the voice of the 909 of you who contributed last year, and the 65 of you who have contributed so far this year.

It is not just a coincidence that even our sleepy Congress-critters and DoT regulators are becoming more sensitive to issues of airline fairplay (and foul play).  It is the growing voice of sites such as this, and people such as you, who are drowning out the soothing platitudes of the multi-million dollar budgeted airline lobbyists and replacing them with the raw edge of reality as we experience and suffer it.

Please join us this chorus of consumer activism and awareness.  Thank you very much.

It has been a very busy week, not only with creating the 10,000 word Buyers Guide to iPad/Tablet computers, but also with analyzing the unexpectedbombshell that exploded on Monday morning when Southwest and AirTran announced their merger.  This announcement attracted even more commentary than past dinosaur mergers have attracted, perhaps because it was so unexpected, and I added 3,000+ words to the discussion as well.

The more I've thought about this since Monday morning's announcement and my rushed analysis, the stranger it seems, and the further Southwest is straying from its core values.  Not initially obvious, but subsequently clarified later in the week was a mini-bombshell within the main bombshell – I'd assumed (shame on me!) that of course Southwest would dump AirTran's 86 Boeing 717 planes.  Southwest is, of course, famous for its inviolable rule that it will only operate one type of airplane – the 737, so it seemed a no-brainer that the 717s would in some way be disposed of.

But now it seems that Southwest plans to keep the 717s.  This is somewhere between surprising and astounding news - not only because of the break from Southwest's almost 40 unbroken years of exclusively operating only 737s, but also because the 717 is a bizarre choice of plane to adopt as a secondary plane.  Only a very few 717s were ever manufactured (155, of which AirTran already has 86), meaning that if Southwest decides to grow its fleet of smaller planes, it will quickly run out of 717s and will need to supplement the 717s with yet another, third type of plane.  And to show how trivial 86 smaller sized planes are, Southwest currently has a fleet of 550 737s (with another 52 to come to it from AirTran).

A lot of the commentary enthusiastically greeting this new merger has been ill considered.  The more I think about it, the less benefit I see to passengers.  AirTran charged less per ticket than did Southwest, even after allowing for some of its fares being at business class levels.

So some of AirTran's former customers - those who flew business class – will be forced to go to another airline (which will, much of the time, be Delta) and should get ready to pay a great deal more for their premium seat (because Southwest is discontinuing AirTran's business class service).

The rest of AirTran's customers - those who enjoyed some of the lowest airfares in the industry - will see their ticket prices go up to Southwest's levels.

One of the great misperceptions of Southwest is that it is a low fare airline.  Its average fares, in terms of cents per mile, are higher than most other truly low fare airlines, and AirTran fares averaged 15% less than Southwest's.  So, AirTran passengers – get ready for a close to 20% increase in your ticket prices.

And if you are someone like me who hates the thought of flying Southwest with their unique open seating approach, for fear of getting wedged into a middle seat between two other full sized passengers, then you've just lost one of the few lower cost options with assigned seating open to you.

Another much repeated comment is that this new merger increases the pressure on American Airlines to merge with someone/anyone.  I disagree.

American Airlines is not currently in a position to sensibly buy out any other airline, due to its depressed earnings/capital value and high costs.  And notwithstanding the rush by other airlines to merge, doing so creates no immediate direct benefit to the merged airlines, because airlines do not benefit from economies of scale the way traditional eg manufacturing operations do.  It costs as much to fly a 737 from Point A to Point B in terms of jetfuel, maintenance, landing fees, wages, and airplane depreciation, whether it is the only flight the airline flies or whether it is one of 1,000+ flights the airline flies.

The benefit from merging is instead industry-wide.  AA has already benefited by the reduction of competition when NW and DL merged.  It will benefit again when UA and CO complete their merger, and probably again when WN and FL (Southwest and AirTran) merge too, because the marketplace is becoming less competitive and more oligopolistic.

Furthermore, while AA continues to 'go it alone' in the US, let's not forget its various code share partnerships domestically (notably with JetBlue) and its international tie-ups through Oneworld and in particular its $7 billion a year joint venture deal with BA and Iberia across the Atlantic.  AA is already as close to merged as an airline can get.

Read my lips.  The only real benefit from merging is in killing off competitors.  AA doesn't need to do that while the rest of the industry so obligingly does it for them.

I'm not too proud to sing for my supper, or at least to offer you someone else's recorded song in return for your much needed support.  So let's close this part of the week's roundup with a song.

Until next week, please enjoy safe travels

Davidsig265 David.


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