Hidden-city ticketing and the Streisand effect: a cautionary tale
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Hidden-city ticketing and the Streisand effect: a cautionary tale
"Hidden city" ticketing and other tricks for cheap flights have been discussed from time to time in this forum. So this fascinating article in the Economist may be of interest. It describes how United Airlines is suing a young guy who set up a website that automates the search for "hidden city" itineraries in the US and then links directly to the airline site to book the ticket.
The result of the lawsuit, in a neat demonstration of the Streisand effect, has been a sharp rise in the use of hidden city tickets.
The article also helpfully provides instructions on how to use the Google Matrix service to find and book hidden city itineraries.
The result of the lawsuit, in a neat demonstration of the Streisand effect, has been a sharp rise in the use of hidden city tickets.
The article also helpfully provides instructions on how to use the Google Matrix service to find and book hidden city itineraries.
Paxing All Over The World
I love watching large, old companies making a hash of things.
I love watching old companies/govts fighting the last war without even realising that there's a new war.
The 'David' using social funding for his legal defence is fabulous.
At the risk of boring the regulars in the forum, Companies have to learn that someone is watching them all the time. They are taking photographs as the agent/crew say the 'wrong' thing. They are reporting on social media when the service fails (in their estimation). This not good or bad - but it IS the way it is NOW.
I love watching old companies/govts fighting the last war without even realising that there's a new war.
The 'David' using social funding for his legal defence is fabulous.
At the risk of boring the regulars in the forum, Companies have to learn that someone is watching them all the time. They are taking photographs as the agent/crew say the 'wrong' thing. They are reporting on social media when the service fails (in their estimation). This not good or bad - but it IS the way it is NOW.
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"Hidden city" ticketing and other tricks for cheap flights
There are a whole litany of perfectly legal ticketing 'tricks' you can play with the airlines to save yourself potentially substantial amounts of money. But hidden city ticketing aint' one of them.
I hope United win their case against this chap, he really is taking the biscuit if that's what he's doing (openly flogging hidden city tickets).
to use the Google Matrix service to find and book hidden city itineraries.
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Did you read the article, Mixture? The fellow isn't flogging anything, it's Opodo and United which are flogging the actual tickets. His website just helps people find hidden-city itineraries.
And "fraud"? Not by any legal definition of the term. Unethical, possibly. As the article points out (you may have to read it, Mix) the practice may also be against the interests of consumers in the longer term, as the only real remedy the airlines have (since it isn't fraud) is to raise prices.
And "fraud"? Not by any legal definition of the term. Unethical, possibly. As the article points out (you may have to read it, Mix) the practice may also be against the interests of consumers in the longer term, as the only real remedy the airlines have (since it isn't fraud) is to raise prices.
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Oxford dictionary definition :
Wikipedia definition of hidden city :
Thus because hidden city ticketing has no use other than personal financial gain, a person would be effectively committing fraud, since they will be knowingly buying a ticket with the full intention at the time of purchase of discarding the segment.
Do it once and the airline might turn a blind eye, but make a habit of it and that's where the word fraud comes into play.
Wrongful or criminal deception intended to result in financial or personal gain
Hidden city ticketing occurs when a passenger disembarks an indirect flight at the connection node. Flight fares are subject to market forces, and therefore do not necessarily correlate to the distance flown. As a result, a flight between point A to point C, with a connection node at point B, might be cheaper than a flight between point A and point B. It is then possible to purchase a flight ticket from point A to point C, disembark at the connection node (B) and discard the remaining segment (B to C).
Thus because hidden city ticketing has no use other than personal financial gain, a person would be effectively committing fraud, since they will be knowingly buying a ticket with the full intention at the time of purchase of discarding the segment.
Do it once and the airline might turn a blind eye, but make a habit of it and that's where the word fraud comes into play.
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Hidden City ticketing is specifically prohibited in UA's conditions of carriage. Passengers who book through UA's website agree that they will not use Hidden City ticketing.
Just about every other airline on the planet (that have through fares via connecting points) specifically prohibit the practice. Easyjet, Ryanair et al, don't prohibit it but who cares, you can't do it on a point to point airline.
The young man in question is counselling passengers to breach their contract terms with United airlines. That is what this case is about, not the validity of the prohibition.
If caught the passenger will be refused transport, again pursuent to the contract terms they have agreed.
The courts and consumer agencies have reviewed these rules (ad nausium) and have always (finally) upheld the airline's position that such terms are fair and reasonable.
The EU is "addressing" the issue, in their draft rewrite of Regulation 261, by requiring airlines to accept hidden city passengers but allows the airline to charge the fare that applies to the journey the passenger actually (intends to) takes. In other words they agree that lower fares cannot be secured from Hidden City ticketing.
Just about every other airline on the planet (that have through fares via connecting points) specifically prohibit the practice. Easyjet, Ryanair et al, don't prohibit it but who cares, you can't do it on a point to point airline.
The young man in question is counselling passengers to breach their contract terms with United airlines. That is what this case is about, not the validity of the prohibition.
If caught the passenger will be refused transport, again pursuent to the contract terms they have agreed.
The courts and consumer agencies have reviewed these rules (ad nausium) and have always (finally) upheld the airline's position that such terms are fair and reasonable.
The EU is "addressing" the issue, in their draft rewrite of Regulation 261, by requiring airlines to accept hidden city passengers but allows the airline to charge the fare that applies to the journey the passenger actually (intends to) takes. In other words they agree that lower fares cannot be secured from Hidden City ticketing.
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Interesting.
The other day I went somewhere via Munich and a couple of days before I travelled, it turned out that I actually had to go somewhere which is fairly close to Munich instead of my destination.
I considered asking the airline (LH) if I could exit at Munich but instead I decided to go home for a night before continuing on, for various reasons. I guess if I had asked they would have looked at this fairly dimly and accused me of being a hidden-city ticketer?
The other day I went somewhere via Munich and a couple of days before I travelled, it turned out that I actually had to go somewhere which is fairly close to Munich instead of my destination.
I considered asking the airline (LH) if I could exit at Munich but instead I decided to go home for a night before continuing on, for various reasons. I guess if I had asked they would have looked at this fairly dimly and accused me of being a hidden-city ticketer?
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Hidden-city ticketing is certainly a breach of contract, and as ExXB says if you are caught doing it you will likely be refused carriage. But there is not much more the airline can do. In theory, the airline could sue you for damages arising from the breach of contract, but clearly this will rarely be a worthwhile undertaking.
It is not fraud; fraud is a criminal offence in most countries - and I am not aware that hidden-city ticketing is illegal anywhere. If it was fraud, in the legal sense, then airlines could quickly stamp out the practice with a few prosecutions, which even if unsuccessful would likely have a dampening effect.
I don't think that breaching the terms of a commercial contract - even deliberately and with premeditation - is fraudulent in and of itself.
But this is by the by; I wonder if Mixture has actually read the article yet?
It is not fraud; fraud is a criminal offence in most countries - and I am not aware that hidden-city ticketing is illegal anywhere. If it was fraud, in the legal sense, then airlines could quickly stamp out the practice with a few prosecutions, which even if unsuccessful would likely have a dampening effect.
I don't think that breaching the terms of a commercial contract - even deliberately and with premeditation - is fraudulent in and of itself.
But this is by the by; I wonder if Mixture has actually read the article yet?
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they'd never get a jury to convict - or a judge either
the airline would have to show a "loss" or "damage" - any passenger could reasonably argue they were SAVING them fuel by not occupying the seat on the last leg
the airline would have to show a "loss" or "damage" - any passenger could reasonably argue they were SAVING them fuel by not occupying the seat on the last leg
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Not the same, but similar, I remember needing to fly SYY-GLA. One way was something stupid like £230 (this is 17 years ago) and when asked how much a return was I was informed it was illegal to knowingly buy a return with no intention of using it. I booked the return flight and got to GLA for £105, never had any letters or knocks at my door!
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Similar tale here. Researching a flight from DUB to CLE came out as ridiculous $$$ . Tried a flight DUB-DTW with the intention of a one way car hire to CLE . It was cheaper ,much cheaper. Guess what? There was a change of flights at CLE.....
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Heathrow Harry, the airline doesn't have to take you to court.
If it's a on-off they will probably ignore it.
If they detect persistent abuse of their terms and conditions, which the passenger has explicitly agreed to, they will likely contact the passenger and ask them to cease and desist. If the passenger continues then they will likely blacklist the passenger (Their right to do so is also in their terms and conditions).
If an agent is issuing the tickets they will charge back the differences to the agency. They can and have done this. Few agents are willing to take the risk.
The airline's simply have too much to lose than to allow this to become common practice.
Oh, and good luck keeping any FF miles you made on these trips.
Edited to add - passengers have taken airlines to court attempting to have such airline practice declared illegal. While they have succeeded in low courts they have never succeeded in appeal.
If it's a on-off they will probably ignore it.
If they detect persistent abuse of their terms and conditions, which the passenger has explicitly agreed to, they will likely contact the passenger and ask them to cease and desist. If the passenger continues then they will likely blacklist the passenger (Their right to do so is also in their terms and conditions).
If an agent is issuing the tickets they will charge back the differences to the agency. They can and have done this. Few agents are willing to take the risk.
The airline's simply have too much to lose than to allow this to become common practice.
Oh, and good luck keeping any FF miles you made on these trips.
Edited to add - passengers have taken airlines to court attempting to have such airline practice declared illegal. While they have succeeded in low courts they have never succeeded in appeal.
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Oh, and good luck keeping any FF miles you made on these trips.
In this day and age, FF members abusing ticketing rules may well find themselves talking to the airline's Revenue Protection and Integrity units sooner than they think !
Even without FF programmes, don't underestimate the power of the database....
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I don't think I've ever done a 'H-C' trip and have no intention of starting but I shall continue to watch the fight with amusement.
On the side of the carriers - Through my participation of PPRuNe, I know that they do not make the money they used to and am well aware of the rapidly changing passenger loads (all the usual causes) and the contrasting long financial commitments they have to undertake. More change is yet to come.
On the side of the carriers - Through my participation of PPRuNe, I know that they do not make the money they used to and am well aware of the rapidly changing passenger loads (all the usual causes) and the contrasting long financial commitments they have to undertake. More change is yet to come.
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Having paid exhorbitant fares on some flights, I wouldn't feel too badly about taking advantage of a hidden city ticket deal.
I'm not too concerned about the heads I win tails you lose contract of carriage, where even cancelled flights don't bring the traveler a refund of the fare paid for a service not delivered.
You're right, in that having given exposure to the practice will only encourage more travelers to look for and find hidden city deals, as long as they can travel with carry-on bags only.
Could this be the reason that many carriers now deliver gate checked bags only at the baggage claim at final ticketed destination?
I'm not too concerned about the heads I win tails you lose contract of carriage, where even cancelled flights don't bring the traveler a refund of the fare paid for a service not delivered.
You're right, in that having given exposure to the practice will only encourage more travelers to look for and find hidden city deals, as long as they can travel with carry-on bags only.
Could this be the reason that many carriers now deliver gate checked bags only at the baggage claim at final ticketed destination?
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You're right, in that having given exposure to the practice will only encourage more travelers to look for and find hidden city deals, as long as they can travel with carry-on bags only.
Could this be the reason that many carriers now deliver gate checked bags only at the baggage claim at final ticketed destination?
Could this be the reason that many carriers now deliver gate checked bags only at the baggage claim at final ticketed destination?
So you are saying it is OK to cheat the airline out of their published fares because you don't like them, or consider them exhorbitant? Try that in a shop.
Airlines also prohibited back-to-back ticketing or nested ticketing. A traveler wants to make two round trips midweek. At one time, airlines typically charged more for midweek round trips than trips that involved a Saturday night stay. This ploy allows the traveler to book two round-trip tickets with Saturday stays even though the actual travel is all midweek. If a business traveler wanted to make two round trips from New York to Los Angeles in two consecutive weeks, the traveler could book a round trip leaving New York Monday of week 1 and returning to New York Friday of week 2. Then the traveler could book a second round-trip ticket in the opposite direction, leaving Los Angeles on Friday of week 1 and return to Los Angeles Monday of week 2. In week 1, the traveler flies the first leg of the first ticket, then returns home on the first leg of the second ticket. The following week the traveler flies from New York to Los Angeles again, this time on the second leg of the second ticket, and finally returns to New York on the second leg of the first ticket.
A humorous comparison:
If you want to do hidden cities ticketing, forget the FF miles, book using pre pay credit cards, have a few different addresses and try slight name changes eg
John Smith, Jonh F Smith, Johnnie Smith, J Smith ESQ, J Smith Jnr etc.
A couple of driving licences from different states should give enough possible combinations to stay ahead of the system for all but the extremely regular flyer.
A humorous comparison:
If Paint was sold like Plane Tickets
Buying Paint from a Hardware Store:
Customer:
Hi. How much is your paint?
Clerk:
We have regular quality for $12 a gallon and premium for $18. How many gallons would you like?
Customer:
Five gallons of regular quality, please.
Clerk:
Great. That will be $60 plus tax.
Buying Paint from an Airline:
Customer:
Hi, how much is your paint?
Clerk:
Well, sir, that all depends.
Customer:
Depends on what?
Clerk:
Actually, a lot of things.
Customer:
How about giving me an average price?
Clerk:
Wow, that's too hard a question. The lowest price is $9 a gallon, and we have 150 different prices up to $200 a gallon.
Customer:
What's the difference in the paint?
Clerk:
Oh, there isn't any difference; it's all the same paint.
Customer:
Well, then, I'd like some of that $9 paint.
Clerk:
Well, first I need to ask you a few questions. When do you intend to use it?
Customer:
I want to paint tomorrow, on my day off.
Clerk:
Sir, the paint for tomorrow is the $200 paint.
Customer:
What? When would I have to paint in order to get the $9 version?
Clerk:
That would be in three weeks, but you will also have to agree to start painting before Friday of that week and continue painting until at least Sunday.
Customer:
You've got to be kidding!
Clerk:
Sir, we don't kid around here. Of course, I'll have to check to see if we have any of that paint available before I can sell it to you.
Customer:
What do you mean check to see if you can sell it to me? You have shelves full of that stuff; I can see it right there.
Clerk:
Just because you can see it doesn't mean that we have it. It may be the same paint, but we sell only a certain number of gallons on any given weekend. Oh, and by the way, the price just went to $12.
Customer:
You mean the price went up while we were talking!
Clerk:
Yes, sir. You see, we change prices and rules thousands of times a day, and since you haven't actually walked out of the store with your paint yet, we just decided to change. Unless you want the same thing to happen again, I would suggest that you get on with your purchase. How many gallons do you want?
Customer:
I don't know exactly. Maybe five gallons. Maybe I should buy six gallons just to make sure I have enough.
Clerk:
Oh, no, sir, you can't do that. If you buy the paint and then don't use it, you will be liable for penalties and possible confiscation of the paint you already have.
Customer:
What?
Clerk:
That's right. We can sell you enough paint to do your kitchen, bathroom, hall and north bedroom, but if you stop painting before you do the bedroom, you will be in violation of our tariffs.
Customer:
But what does it matter to you whether I use all the paint? I already paid you for it!
Clerk:
Sir, there's no point in getting upset; that's just the way it is. We make plans based upon the idea that you will use all the paint, and when you don't, it just causes us all sorts of problems.
Customer:
This is crazy! I suppose something terrible will happen if I don't keep painting until after Saturday night!
Clerk:
Yes, sir, it will.
Customer:
Well, that does it! I'm going somewhere else to buy my paint.
Clerk:
That won't do you any good, sir. We all have the same rules. Thanks for painting with our airline.
Buying Paint from a Hardware Store:
Customer:
Hi. How much is your paint?
Clerk:
We have regular quality for $12 a gallon and premium for $18. How many gallons would you like?
Customer:
Five gallons of regular quality, please.
Clerk:
Great. That will be $60 plus tax.
Buying Paint from an Airline:
Customer:
Hi, how much is your paint?
Clerk:
Well, sir, that all depends.
Customer:
Depends on what?
Clerk:
Actually, a lot of things.
Customer:
How about giving me an average price?
Clerk:
Wow, that's too hard a question. The lowest price is $9 a gallon, and we have 150 different prices up to $200 a gallon.
Customer:
What's the difference in the paint?
Clerk:
Oh, there isn't any difference; it's all the same paint.
Customer:
Well, then, I'd like some of that $9 paint.
Clerk:
Well, first I need to ask you a few questions. When do you intend to use it?
Customer:
I want to paint tomorrow, on my day off.
Clerk:
Sir, the paint for tomorrow is the $200 paint.
Customer:
What? When would I have to paint in order to get the $9 version?
Clerk:
That would be in three weeks, but you will also have to agree to start painting before Friday of that week and continue painting until at least Sunday.
Customer:
You've got to be kidding!
Clerk:
Sir, we don't kid around here. Of course, I'll have to check to see if we have any of that paint available before I can sell it to you.
Customer:
What do you mean check to see if you can sell it to me? You have shelves full of that stuff; I can see it right there.
Clerk:
Just because you can see it doesn't mean that we have it. It may be the same paint, but we sell only a certain number of gallons on any given weekend. Oh, and by the way, the price just went to $12.
Customer:
You mean the price went up while we were talking!
Clerk:
Yes, sir. You see, we change prices and rules thousands of times a day, and since you haven't actually walked out of the store with your paint yet, we just decided to change. Unless you want the same thing to happen again, I would suggest that you get on with your purchase. How many gallons do you want?
Customer:
I don't know exactly. Maybe five gallons. Maybe I should buy six gallons just to make sure I have enough.
Clerk:
Oh, no, sir, you can't do that. If you buy the paint and then don't use it, you will be liable for penalties and possible confiscation of the paint you already have.
Customer:
What?
Clerk:
That's right. We can sell you enough paint to do your kitchen, bathroom, hall and north bedroom, but if you stop painting before you do the bedroom, you will be in violation of our tariffs.
Customer:
But what does it matter to you whether I use all the paint? I already paid you for it!
Clerk:
Sir, there's no point in getting upset; that's just the way it is. We make plans based upon the idea that you will use all the paint, and when you don't, it just causes us all sorts of problems.
Customer:
This is crazy! I suppose something terrible will happen if I don't keep painting until after Saturday night!
Clerk:
Yes, sir, it will.
Customer:
Well, that does it! I'm going somewhere else to buy my paint.
Clerk:
That won't do you any good, sir. We all have the same rules. Thanks for painting with our airline.
John Smith, Jonh F Smith, Johnnie Smith, J Smith ESQ, J Smith Jnr etc.
A couple of driving licences from different states should give enough possible combinations to stay ahead of the system for all but the extremely regular flyer.
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So you are saying it is OK to cheat the airline out of their published fares because you don't like them, or consider them exhorbitant? Try that in a shop.
I'm not endorsing the practice of H-C ticketing, and don't use it myself (although I confess to occasionally buying return tickets for one-way use). But I'm sure many travellers suspect that if an airline charges more for a trip A-B than it charges for A-B-C, then the price for the A-B trip is artificially inflated, and the airline is therefore cheating them. In such circumstances, they would see H-C ticketing not as cheating but as a morally justifiable way of righting the initial wrong.
But coming back to United's dilemma - cracking down on H-C ticketing is likely to draw attention to the practice and to increase its prevalence. The options for airlines are limited: it is one thing to blacklist 10 persistent abusers, but quite another to blacklist 10,000. The only real option is to adjust the pricing to make H-C unattractive. Whether this would be better or worse for consumers overall is hard to judge.
Last edited by Gibon2; 14th Jan 2015 at 08:11. Reason: Metro man was quicker with the paint story
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Giben2
When an airline looks at pricing for AAA to CCC in considers the competitive factors in the AAA to CCC market. Fares charged by other airlines, fares applicable to nearby airports, market analysis on what passengers are prepared to pay, supply and demand, and a million other considerations.
The fares to BBB are irrelevant in this analysis. What people are able and willing to pay to CCC is. If you charge the higher BBB fare (or the sum of the sector fares) you will not sell many, if any, tickets. If the airline decides it wants to be in the AAA CCC market it will have prices that it believes it can sell in that market. If it decides it doesn't want to be in that market it will not offer competitive fares.
The airline must decide if it will have empty seats AAA-BBB and BBB-CCC and if the revenue it receives for the total journey is better than no revenue (and having the seats fly empty) at all.
Pricing for an individual seat is not cost plus, it can't be. Pricing must ensure that the total revenue received for a flight exceeds the cost of operation plus a little more for the shareholders.
When an airline looks at pricing for AAA to CCC in considers the competitive factors in the AAA to CCC market. Fares charged by other airlines, fares applicable to nearby airports, market analysis on what passengers are prepared to pay, supply and demand, and a million other considerations.
The fares to BBB are irrelevant in this analysis. What people are able and willing to pay to CCC is. If you charge the higher BBB fare (or the sum of the sector fares) you will not sell many, if any, tickets. If the airline decides it wants to be in the AAA CCC market it will have prices that it believes it can sell in that market. If it decides it doesn't want to be in that market it will not offer competitive fares.
The airline must decide if it will have empty seats AAA-BBB and BBB-CCC and if the revenue it receives for the total journey is better than no revenue (and having the seats fly empty) at all.
Pricing for an individual seat is not cost plus, it can't be. Pricing must ensure that the total revenue received for a flight exceeds the cost of operation plus a little more for the shareholders.
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Pricing for an individual seat is not cost plus, it can't be.
Gibon2 needs to go away, do a great deal of bed time reading and then come back with a more realistic viewpoint on how airlines work !
A trip to the local library to peruse a few issues of Journal of Revenue and Pricing Management might be a start if you want a cutting-edge view on the matter, otherwise a few theoretical books on the subject of Revenue/Pricing/Yield management.
As ExXB says Gibon2, the airline business is cut-throat and highly-competitive and a vast number of business inputs are fed into the magic black box that spits out the prices. The basics such as cost of fuel, staff, lease on the aircraft is only really the start of a very long list indeed.......