Low Cost Airlines

Inner Battles Of Low Cost Airlines

For 12 months, United refused to allow Frontier "cohost" status, which would improve Frontier's display. Frontier and United are the two leading carriers serving Denver and compete in many western markets of low cost airlines.

There is a great advantage to low cost airlines if their flight is listed first on the first screen displayed by the travel agent's computer. Justice said that American Airlines determined in 1981 that 92 percent of all Sabre sales come from the first screen and that 53.5 percent come from the first line of the first screen.

For other airlines, a computer bias can mean a shift in thousands of dollars of revenue from one airline to another as travel agents book the flight most prominently displayed.

"The continued lack of rules for computer systems may further inhibit competition among air carriers and injure consumer welfare," the Justice filing said. The CAB is preparing a draft set of rules and has sought comments such as Justice's.

Sabre and Apollo systems have been sold or leased to about 75 percent of the computerized travel agents. Further, Justice found, Sabre is the dominant system with more than 40 percent of the travel agents in 10 urban areas with populations over one million; Apollo is dominant in seven and TWA's PARS systems is dominant in three.

Aviation officials from Britain and America meet in London again this week in a new attempt to resolve the growing row over transatlantic flights between the two countries. Relations between aviation officials in London and Washington have sunk following last week's unprecedented decision by Britain's Department of Transport to block plans by the major airlines - including British Airways, Pan American and TWA - to cut fares on the busy North Atlantic crossing this winter.

Britain ruled that the new fares, which included a cut of pounds 40 in the London-New York return fare to only pounds 259, were invalid - even though the big airlines had already sold more than 100,000 tickets worth at least pounds 30 million. Ironically, aviation officials from the two countries are expected to sit down together, the very day that the new cheap fares were supposed to have taken effect. The wrangle has left transatlantic passengers in a state of confusion, angered the airlines and further soured relations between Britain and America.

At the heart of the current dispute sits the existing air traffic agreement between Britain and America, signed in the less competitive airline days of 1977 and known as the Bermuda Two agreement.