Thursday, January 29, 2009

JetBlue coming to LAX - lookout Virgin America

JetBlue has just launched the latest salvo in the trans-con wars. Following on the heels of Virgin America's announcement of two daily Boston-LAX nonstops set to begin in February, JetBlue just announced similar service launching on June 17th.

Not to be outdone, American Airlines has also announced an additional Boston-LAX flight to the the three they already operate.

Suddenly, Boston will go from 5 daily nonstops to LA (two on United and 3 on American) to 10 - a near doubling of capacity will create a capacity bloodbath - get ready for great deals Bostonians and Angelenos....... and to Virgin America, good luck.

Wednesday, January 28, 2009

Virgin America: Dueling with Southwest (yet again)

Virgin America, the airline that has come up with so many unique ideas (think mood lighting!) just can't seem to find a unique idea when it comes to its route structure.

Southwest announced new service from SFO to Orange County with five daily flights back on January 15th starting on May 9th.

Yesterday, Virgin America announced similar service with, guess what, five daily flights to begin April 30th.

There is no question this route is ripe for low-cost competition - American and United are both currently charging $379 for a one-way walk-up fare vs. ~ $144 for SFO to LAX where Southwest (and Virgin America) provide healthy competition.

But we wonder why Virgin America is so desperate to challenge the most brutal competitor in the business - Southwest. Its a game we doubt they will win. Southwest has deep pockets and proven staying power. Southwest's considerable market power and brand awareness in both Southern California and the Bay Area are tough to match.

For good measure, we predict in the face of plummeting yields, American's current regional jet service on the route will be abandoned shortly after all this new service is inaugurated.

Surely there must be other routes where Virgin America can provide their unique service without constantly banging heads with Southwest. How about using those shiny new A320s on a route long enough to actually appreciate the mood lighting and the massage chairs in First Class....

Monday, January 26, 2009

Hilton to Launch Home2 Suites Extended Stay Product

Today Hilton announced a new brand, Home2 Suites by Hilton. You might think that its an odd time to launch a new brand in the beleaguered hospitality space but this brand may have staying power.

Consider that Hilton claims to already have 10 franchise applications - most importantly with financing in place. If you are a developer looking for a brand to put on a new build - the power of Hilton global sales force, marketing programs and HHonors program is not to be dismissed. This is a huge advantage for Hilton.

Next, the brand itself is right for the times. In tough times, what sounds better than a "homey" suite to curl up in? The style is "hip and humble" according to Hilton - sounds like a significant upgrade to Hilton's current Homewood Suite offering which is plenty humble but certainly not hip.

Home2 has many similar design elements to Starwood's aloft product but will probably not have the jarring music as you walk in the door. It sounds more like a home than aloft's "everyone should check-in in a bar/nightclub" approach. Sounds good for the times.

But apart from more light and less music (we hope) many things are pretty similar between the brands. Consider:

  • Similar number of keys (90-180 for aloft, 108 for Home2)
  • Small real estate footprint required for construction
  • Community lobby meant for gusts to "hang out" and work in (aloft's is more like a bar and Home2's feels more akin to a Starbucks)
  • Free wireless throughout the hotel
  • Small indoor pools, outdoor areas for socializing
  • And of course, a green approach with things like bulk shower dispensers; dual-flush toilets; and recycled flooring
Granted, aloft's product isn't designed to be an extended stay product but the similarities are remarkable.

And at least Hilton will allow us to capitalize the first letter - home2 would have been painful.

No more Letterman on American Airlines

American Airlines and NBC have announced a new partnership that will, apparently, silence David Letterman on AA flights starting March 1st....

Too bad, as Letterman is usually about the only part of flying with American that we enjoy....

Friday, January 23, 2009

YouTube monetization gone awry - Qantas advertises on footage of US Airways landing in the Hudson

Well, the WSJ is reporting that finally video has emerged showing the harrowing and heroic landing of US Airways flight1549 ditching in the Hudson River last week.

The videos are still quite grainy and it is hard to see the actual landing sequence but better than nothing.

However, what is shocking is the YouTube "overlay" ad from Qantas advertising the new Airbus A380! Its probably not the kind of display Qantas was looking for when they purchased the "airbus" keyword. The USAirways flight was an Airbus A320 so its not hard to see how the mash-up occurred but this example should give e-marketers plenty to think about when designing ad campaigns.

Portaga is laid to rest....... (a site we follow frequently!) is reporting that Portaga has filed for bankruptcy and will liquidate.

Portaga has been around for several years and has previously raised money from First Round Capital and Ascend Venture Group among others - $5.8M as recently as the end of 2006.

Portaga was an interesting way to link travel and outlook but we have always thought Portaga was an interesting feature, but probably not a stand-alone business in and of itself.

Lets hope this isn't a harbinger for travel 2.0 start-ups in 2009.

Thursday, January 22, 2009

United and Aer Lingus get closer

Today's WSJ is reporting that Aer Lingus and United are pairing up beyond their existing codeshare routes to/from the Emerald Isle to launch a new nonstop route from Washington Dulles (IAD) to Madrid (MAD). The flight will be operated by an Aer Lingus A330 aircraft and crew. Made possible by the recent open skies liberalization accord between the US and the EU, this new flight will be interesting to watch for a number of reasons.

Most efforts by the legacy carriers to expand beyond their current home bases have proved fruitless thus far. Air France gave up their 777 LAX-London Heathrow flights after a short while and OpenSkies from BA is rumored to be having a tough time with their JFK-Paris Orly and Amsterdam flights.

The WSJ notes that Aer Lingus' labor costs are below United's which is probably true - but how will United's notorious unions react to what appears to be a blatant outsourcing from one of United's largest hubs? This isnt like Lufthansa is simply adding another flight from FRA to Dulles that UA is codesharing on - this is flying that could have been operated with UA metal and crews. We applaud UA and EI for thinking out of the box - we just hope its worth the potential pain UA (and UA's passengers) may feel as a result.

And finally, if we needed any more indications that the airline industry suffers from schizophrenia, lets remember that Aer Lingus, in addition to codesharing with UA on flights it operates, codeshares on JetBlue operated flights. And Lufthansa, a key UA partner, owns a good sized chunk of JetBlue.

Wednesday, January 21, 2009

Clem Bason to take the reins at

Expedia announced this morning that insider Clem Bason would take over the postion vacated by the promotion of Eric Grosse to President of Expedia Worldwide...

We think Clem is a great choice, Dara. Clem is sharp and knows the business well. He'lll be a stable, steady hand. The question we have now is who will fill the void left by Paul Brown's departure?

Bad economy leads to strange bedfellows - AirTran and Ritz Carlton! Really?

Wow, things must really be rough at Ritz Carlton - AirTran (not exactly the Ritz Carlton of airlines) is sending out its weekly low-fare email with a huge plug for Ritz Carlton hotels! Talk about brand dysfunction. Marriott, fine, but Ritz, really?

Right there, next to $49 fares to Newport News is and ad encouraging AirTran customers to think about staying at Ritz's resorts! I wonder how many AirTran customers regularly stay at Ritz Carltons....

Washington DC - was it really sold out?

So, was DC really sold out for the Inauguration? We had some nice press from our friends at USA Today and the LA Times around this subject:


We certainly saw lots of rooms pop up for one night stays at the last minute at some great hotels such as The Fairfax and the Sheraton Four Points DC. As mentioned in the above blogs, I even got a room at the Alexandria Hilton using HHonors points - and I ran into a good friend of mine there who had done the same thing. It was certainly a good event from the hotelier's perspective but also a great example of procrastination paying off!!