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Airlines seek shutdown of online miles trackers
Websites that help busy travelers keep track of their frequent flier miles and hotel points are growing in popularity. But now, two airlines -- American and Southwest -- are trying to put them out of business.
Why?
Personal finance expert and CBS News contributor Regina Lewis explained airlines have operated loyalty programs successfully for 30 years, and are now losing control, never imagining that people would hand over their passwords to third-party tracking websites.
According to the Wall Street Journal, the two carriers have sent "cease and desist" letters in the past year to several websites that track travelers' loyalty programs.
The carriers argue that tracking sites, such as AwardWallet.com, Milewise.com and GoMiles.com, pose a security risk because passwords are spread to sites across the web. In addition, the airlines contend the outside sites tax the airlines' own websites.
Lewis said, "In technology terms, in order to (track my miles) I have to ping the website and 'scrape' the data. You could be checking your miles, (while another person) is trying to buy a ticket. The website may be slower. The (tracking) websites say, 'Get over it. The people on the miles, they should know what they are worth, and we are getting people hungry for miles.'"
Lewis said for the airlines, what's at stake is control.
"(Businesses) want to control the customer relationship," she said. "Now, somebody is in-between. If I go to one of these websites, I'm not going to the airline website and (the airlines are not getting) all of the up-sell (opportunity to sell customers on more or more expensive products and services) that usually comes with that."
The draw of these tracking websites for consumers is keeping miles programs organized.
"(The sites) track your miles and alert you when they are going to expire. Twenty percent of miles go unused, so that's leaving things on the table. ... And this is where they get really influential -- and might explain the airlines' case -- they change your purchasing decision because now, when I go to pick a flight, it will say, 'OK, here is what that flight costs, but wait a second -- you have miles you can use. You really want to pick this one over that one,' or, 'You have miles to cover half of it,' and it influences my purchasing decision by factoring the miles into the cost.'"
Is it safe to use these sites?
"I think people should feel reasonably safe," Lewis said. "Miles are money and they're a currency. The way this works is the average coach ticket is about $350. If you divide that by 25,000 miles, you're at 1.4 cents. You can you use your miles on other things, upgrades, hotels, digital cameras, merchandise. Do the math, divide by the number of miles; when you dip below a penny you're devaluing your own currency. If you're new at this, before you use the websites, stick with one airline and milk it for all it's worth; that's usually the fastest way to the finish line."
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