Subscriptions: A new way to pay for flights

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Jacob van Cleef
Consumer Watchdog, Associate

Author: Jacob van Cleef

Consumer Watchdog, Associate

Started on staff: 2020
B.A. Villanova University

Jacob works to advance U.S. PIRG’s Consumer Watchdog campaign. He graduated from Villanova University, majoring in Economics and Political Science and minoring in Peace & Justice. While originally from Detroit, Jacob now lives in Philadelphia, where he enjoys soccer, listening to podcasts and cooking.

Subscriptions have become more common in different industries. People can buy subscriptions to just about anything from sports streams to wines to cloud pictures. Some Americans will add another service onto that list: airline flights. For Alaska Airlines flights between certain West coast cities, customers have been able to subscribe to get tickets for six, 12 or 24 round-trips for $14.61 per flight in addition to the subscription cost. The offer started Feb. 16.

Full details can be found on the Alaska Airlines website. There are two tiers that dictate how far in advance someone needs to book a flight. For $49 per month, a flight can be booked 14 days in advance; for $199 per month, you can book two hours in advance. The person chooses to fly on six, 12 or 24 round-trips. That determines the amount of credits received per month or every other month. Each credit allows the customer to book a round-trip for $14.61 per flight (with some exceptions) until the credit expires, when the next batch of credits are given. The $14.61 can be broken down into $0.01 for the ticket and $14.60 for airport taxes and fees. Flights can be changed without a fee.

Why is Alaska Airlines doing this?

A potential reason is the subscription model allows the airline to have some guaranteed money after revenue plummeted during the pandemic. This could entice frequent flyers to switch to Alaska to save money while still earning miles. Also with subscription services becoming more popular, this is a test to see whether this is a profitable business model to build on. At the end of the day, it boils down to seeing whether this could make the airline more money.

What could this mean for the future?

If this program becomes successful, a lot could change, especially for frequent flyers. Other airlines would probably offer their own versions with slight differences. Some might add family plans or other arrangements for additional flyers. For flyers in other regions, there would likely be subscriptions for those regions, as well at different prices. Any attempt to launch a nationwide subscription would be more expensive. Prices would likely shift in each plan to try to maximize profit while keeping the frequent flyers interested in a subscription service.

Along with those potential changes for frequent flyers, there may be changes for others as well. There could be attempts to offer an annual subscription to infrequent flyers for folks who fly once or twice a year. Depending on how successful the frequent flyer subscription service is, this could drive up flight prices. If subscribers ever made up a sizable chunk of the total passengers, scarcity of single-trip tickets could drive up prices.

That’s all for the future though. For now, hopefully some people find use in the subscription service, and we’ll see what this may do to the industry.

Jacob van Cleef
Consumer Watchdog, Associate

Author: Jacob van Cleef

Consumer Watchdog, Associate

Started on staff: 2020
B.A. Villanova University

Jacob works to advance U.S. PIRG’s Consumer Watchdog campaign. He graduated from Villanova University, majoring in Economics and Political Science and minoring in Peace & Justice. While originally from Detroit, Jacob now lives in Philadelphia, where he enjoys soccer, listening to podcasts and cooking.