UP FRONT..........................................................

In the Doghouse: American
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The world's largest airline has decided that more comfort is not a recipe for more profits. In fact, American apparently believes the road to profitability lies in more fees and less comfort.

In announcing its 3rd-quarter results -- a $214 million loss -- American outlined a series of steps designed to shore up financial performance, including reducing capacity, streamlining operations and rolling back More Room Throughout Coach.

According to American chief Gerard Arpey: "When we launched More Room Throughout Coach, healthy yields and robust business travel were the norm, and both conditions were essential to the success of More Room. However, times have changed, and we must acknowledge that in today's low-fare environment, having fewer seats on our aircraft has put us at a real revenue disadvantage compared to other airlines."

While it's difficult to quantify the revenue effect of More Room, I suspect that American's analysis is wrong. I have personally made it a priority to book AA flights over the past few years, based in large part on the extra legroom in coach. And I've recommended the more comfortable service to others, both casually and in my capacity as a travel writer. Will the extra seats -- which will mostly go unsold -- offset the loss of goodwill and extra business from travelers and opinion-influencers like myself? I doubt it.

American's move is a real setback for travelers, and puts American in the position of offering, at higher price points, less legroom than JetBlue and Delta's low-fare Song subsidiary. A business model predicated on charging higher prices for a lower-quality product...?

No word yet on AA's new ad tagline. My vote: "Pay More, Get Less."

Industry Newsbites (Signs of the Times)
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As expected, ATA filed for Chapter 11 bankruptcy protection on Tuesday, citing assets totaling $745.1 million and debts of $940.5 million. The airline will maintain current flight schedules, and earning and redeeming in ATA's Travel Awards program is unaffected.

Subject to approval by the bankruptcy court, ATA has reached agreement to sell certain assets to fellow discounter AirTran, including ATA's Chicago Midway gates and routes, and slots at LaGuardia and Washington National airports.

Also in the pipeline: a tie-up between the ATA and AirTran mileage programs, details to be advised.

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In what may be too little, too late to avoid bankruptcy, Delta has arranged a $600 million line of financing from American Express. Of the total, $500 million will be a prepayment for miles Amex will purchase from Delta to award users of the Amex-issued SkyMiles credit card.

Amex's apparent faith in Delta's long-term survival is heartening. And the size of that SkyMiles-related prepayment is a reminder of the revenue contribution of the airlines' mileage programs.

Media Inquiry (Update)
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Thanks to those who responded to last week's media inquiry from Keith Alexander. His story on saving miles for retirement ran in Monday's Washington Post, online at http://washingtonpost.com/wp-dyn/articles/A62517-2004Oct25.html.

ON SITE...........................................................

FrequentFlier Forum Topics
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As always, there's plenty of activity on the FrequentFlier Forum.

In the "Airline Programs" Forum, Xanadu poses a recurring question: "Does anyone know if it is possible to transfer your miles from one program to another? For example - from US Air to Delta?"

In the "Hotel Programs" Forum, Traveling Dad has been directed to use Priceline when booking hotels for company business. His dilemma: "I don't believe Hilton allows points earned on Priceline stays... do any other hotels allow this?"

In the "Airport Discussion" Forum, there's... well, nothing so far. This is a new topic area, established in response to numerous requests from site visitors. Hint: there's nothing sadder than an empty Forum.

And much more... Questions, answers? Post them to the Forum!

-> More: http://frequentflier.com/forums/index.php

MILES & POINTS....................................................

Alaska, Delta Tie-Up (and Double Miles)
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As we reported last month, Alaska and Delta will begin reciprocal frequent flyer program participation on Nov. 1.

To promote the tie-up, Alaska Mileage Plan members will receive double miles when flying Alaska, Horizon or Delta between Nov. 1 and Dec. 15. And SkyMiles members will receive double miles when they travel on any Alaska-coded, Alaska or Horizon flights during the same period.

Registration is required to earn the double miles.

-> More (Alaska): http://alaskaair.com/www2/Promo/Registration/PromoEntry.asp?pid=DL0401
-> More (Delta): http://news.delta.com/article_display.cfm?article_id=9479

Check In Online to Earn America West Bonus
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Through Dec. 31, America West FlightFund members will earn 500 bonus miles the first time they check in online at the America West website.

Travelers can check in online between 24 hours and 90 minutes before the scheduled flight time, and may also arrange upgrades and change seat assignments.

-> More: http://fly.americawest.com/awa/WebCheckin/default.aspx

JetBlue Is New Amex Membership Rewards Partner
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JetBlue will be the next addition to the American Express Membership Rewards program.

Beginning Dec. 8, Amex cardholders can redeem their Membership Rewards points for points in TrueBlue, JetBlue's frequent flyer program.

Since JetBlue has no co-branded credit card, the Amex tie-up is a significant step forward for TrueBlue members, allowing them to earn miles-for-charges in addition to flight miles.

-> More: http://www.americanexpress.com/rewards

Points.com Adds Gold Points
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Gold Points is now a member of the Points.com network, allowing exchanges between Gold Points and other participating loyalty programs.

New PointsPlus members may elect to receive a sign-up bonus of 5,000 Gold Points.

-> More: http://points.com

More Grocery Miles from United
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Mileage Plus members who shop 10 times at participating Safeway, Vons, Dominick's, Pavilions, Pak'n Save Foods and Genuardi's stores between Oct. 29 and Nov. 30 will earn 2,500 bonus miles, in addition to the 125 miles for every $250 in eligible purchases normally awarded.

There's a $25 minimum purchase per visit and only 1 visit per day counts towards the 10 visits.

Registration is required.

-> More: http://www.grocerymiles.com/frequentshopper

Nextel Offers United Bonus
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Mileage Plus members who purchase and activate a Nextel i205 phone for $0.99 by Nov. 30 will earn 10,000 Mileage Plus miles.

Nextel rate plans start at $35.99 per month.

-> More: http://nextelonline.nextel.com/ca/affiliate/united10/index.shtml

STEALS & DEALS....................................................

Deal Alert from SmarterLiving.com
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1) Save 20% on Aeromexico Flights

Mexico-based Aeromexico is putting many of its most popular routes on sale for travel this fall. As a result, travelers can save up to 20% on select flights.

To receive the 20% discount, you must book a roundtrip or 1-way fare online by Nov. 5, and complete your trip by Dec. 9.

-> More: http://www.smarterliving.com/air/deal.php?id=7644

2) Europe Sale Fares on Icelandair from $259

Icelandair is offering Europe sale fares starting at $259 roundtrip. Destinations include Amsterdam, London, Paris, etc. Travel is valid from Oct. 28 through Dec. 16, 2004, or Jan. 3 through Mar. 31, 2005.

Icelandair has not listed a booking deadline, so these fares could disappear at any time.

-> More: http://www.smarterliving.com/air/deal.php?id=7382

SWEEPS & FREEBIES.................................................

AAdvantage Miles Giveaway from Points.com
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Through Dec. 29, sign up for a PointsPlus membership, make a Points.com exchange to/from an AAdvantage account, or send a mail-in entry for a chance to win 1 of 10 grand prizes of 100,000 AAdvantage miles each.

-> More: http://points.com/sweepstakesTerms/AAdvantageMiles.jsp?campaignId=296

[Visit http://frequentflier.com/sweeps.htm for more travel sweepstakes.]

READER RANTS & RAVES..............................................

Feedback from the Frontlines of Travel
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"I recently hit the Diamond Level on my Hilton Honors account and decided to cash in some points at an Embassey Suite. The location is listed as a Category 4 hotel and required 30,000 points. What I couldn't understand, though, is why 30,000 points would be required for a room that goes for only $115. Most of the Hampton Inn locations cost about the same money for a room and are category 1 or 2, requiring only 10,000 or 20,000. In addition, Hilton would not allow me to use points to guarantee a room upgrade as Starwood usually does. I might add that the Embassy Suite location I am going to is way 'offseason.' I will be staying at Starwood locations from now on." (Maria)

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"I booked a ticket from San Diego to Norfolk, Virginia. I borrowed a colleague's car to make a two day trip up to Washington, DC for a conference after visiting him in Norfolk. Unfortunately, his car broke down and I would not have it fixed in time to return back to Norfolk. Fortunately, my return flight stopped in Washington, Dulles. A quick phonecall to United to see if I could board on the IAD to San Diego flight rather than take a bus back to Norfolk to catch my original flight. Alas, having spoken to 2 agents and a supervisor, they...and I quote "informed me that I should have planned for a departure out of IAD" before purchasing this ticket. Yes, I always plan to have a car break down. I will not be flying United again. There is a reason that they are in bankrupcy." (Rob)

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Until next week...