United buys US Airways. American and Delta merge and add Northwest.
TWA, America West and Continental decide to join the United/US
Airways group. The surviving companies are called United and
AmDelta.
To get the deals past all the opponents, the companies rearrange
their board of directors to give the unions a greater voice,
thereby eliminating the noise coming from that quarter.
For the first in a series of reports gauging industry
opinions on airline 'Merger Mania,' click
here.
Justice Department attorneys who are lining up the antitrust
ammunition are quietly advised that if they back off, there are
some good jobs in the legal department of the resulting behemoth
carriers.
George W.'s and Al Gore's people are told there's plenty of
campaign support money to be had, and consumer groups are promised
that if they tone down their protests, all the fares except the
ones most people use will be frozen at current levels
indefinitely.
The deals get approved and within a few days, United and AmDelta
drop travel agency commissions, announcing that net rates will
result in a greater public benefit by stimulating air fare price
competition among travel agencies.
Travel agencies begin to scramble to tack on markups but some
agencies decide against air entirely and become non-air outlets,
referring all air business to specialized ticketing centers.
Eventually the travel agency business splits completely into
ticketing centers that handle air and leisure agencies that sell
tours and cruises.
All the while, travelers become increasingly comfortable buying
air tickets on the Internet, further reducing the need for physical
outlets for air ticket distribution.
The industry settles down into the new order. Many agencies
survive but others give up the ghost. More owners relinquish their
plates and become commission sales agents for the survivors.
Things remain peaceful until airline service begins to
deteriorate. The absence of competition among airline companies
reduces the carriers' inclination to compete along service
lines.
The public begins to clamor for government intervention to
improve airline service. Politicians get into the act, demanding
government re-regulation.
Eventually the Justice Department is asked to investigate the
lack of competition among airlines.
Following a lengthy probe, the Justice Department announces it
believes that the public would be best served by forcing the
remaining two airline companies to divest portions of their
holdings.
And then I woke up.