Free Flights? Award Upgrades? Don’t Count on Them for Much Longer

United’s MileagePlus and Continental’s OnePass will officially merge “early in 2012,” says the airline, and all accrued mileage in both programs will be combined under the MileagePlus umbrella. As part of this announcement, United also tweaked the program rules. Those tweaks, however, will have little or no effect on most average travelers, who will continue to pile up miles easily and use them only with great difficulty.

The announced changes mainly affect elite-level frequent flyers:

• The revised program will have five levels of “premier” status—silver (requiring 25,000 qualifying miles or 30 qualifying flight segments per year), gold (50,000 miles/60 segments), platinum (75,000 miles/90 segments), 1K (1,000,000 miles/120 segments), and “Global Services” (a super-elite level by invitation only).
• Although you can earn qualifying miles on lots of partner lines, at least four of your annual paid flights have to be on United or Copa.
• Mileage bonuses for expensive tickets will juggle a bit, with new levels ranging from 25 percent for full-fare economy to 150 percent for first class on three-class flights.
• Access to extra-legroom economy plus seating will be available at no charge at the time of booking for all levels above silver, and at check-in for silvers.
• Silvers get one no-charge checked bag; higher levels get three.

Eligibility for free upgrades varies by the kind of economy ticket; the advance period to book and confirm those upgrades depends on your elite status, ranging from the day of departure for silvers to 120 hours for Global Service and 96 hours for 1K status.

The only announced change on the award side is that the standard award levels—those high-mileage “you get any available seat” awards—will become “you get almost any available seat” awards. Like Delta, the new United will hold some seats in reserve. Although airlines don’t openly discuss how they mete out reward seats, I would bet a good bit of money that the high-level elites get access to seats even when the ordinary traveler can’t.

These program changes again illustrate the fundamental way in which frequent flyer programs have changed in recent years. Yes, they’re still loyalty programs, but the ‘loyalty’ element now focuses on elite status. The miles you get matter, but the only miles that really matter are those you earn by flying—the ones that determine your elite status. The primary loyalty rewards are no longer ‘free’ trips you buy with miles, they’re upgrades, access to economy plus, and waived baggage fees. Moreover, the new schedules make it clear that access to rewards will depend on your elite level. The focus is fully on coddling the very best customers—certainly an understandable policy. But upgrades and award seats are definitely a zero-sum game: The better it gets for elites, the worse it gets for ordinary travelers.

What about the miles you earn through your credit card and non-flying activities? Now that airlines sell so many miles to banks, the miles have become a cash cow, not a measure of loyalty.

As an ordinary non-elite traveler, you can expect a continued degradation of the usefulness of United’s program and of similar programs, generally:

• In all probability, you will find it increasingly hard to book a “free” award seat for the low “saver” level. Figure that, most of the time, the only way to get an award seat is to use double or more miles for a “standard” award. This, in turn, means that your miles are really worth about half what you previously figured.
• Accordingly, if you don’t earn a lot of miles by flying but still want to maximize your credit, switch from an airline card to a “bank buys a ticket” card offering double mileage credit, where 25,000 miles can still get you a domestic coach ticket most places.
• Given the status-based upgrade access, don’t figure that you can easily use your miles for upgrades any more.

All in all, this is not good news for most of you. And, unfortunately, other lines are likely to move in the same direction.