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American Morning
Interview with Andy Serwer
Aired June 19, 2002 - 07:36 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BILL HEMMER, CNN CORRESPONDENT: Alrighty, time now for "Fortune" magazine's editor-at-large Andy Serwer, minding your business and his as well.
Good morning to you.
ANDY SERWER, "FORTUNE" MAGAZINE: Good morning to you, Bill.
HEMMER: Frequent flier miles, when you can use them.
SERWER: Absolutely. Yes. Yes. Big news for business travelers, recreational travelers. The story here is that Americans are racking up frequent flier miles like never before and companies are doing some interesting things when it comes to redeeming them.
Let's go down to Amanda Lang at the New York Stock Exchange, the traveling lady herself.
What's up with these programs?
AMANDA LANG, CNN CORRESPONDENT: Well, the problem for the airlines, Andy, of course, is that there are tons of unused miles. And, in fact, according to one report in the "Wall Street Journal," eight trillion unused frequent flier miles.
SERWER: Yow!
LANG: And that is an increase of 20 percent from the end of 2000. And it's a liability for the airlines. It's sitting out there and the trouble is they need to get people using them. So they're trying to come up with some creative ways to partner with people and find other ways to get those miles used.
You may have had this experience. It can sometimes be hard to use your miles with your regular airline.
SERWER: Oh, yes.
LANG: There's lots of blackout periods and...
SERWER: Right.
LANG: The last thing the airlines need right now is all of us to fly entirely on miles all the time. SERWER: Right. If you've ever tried to go to the Caribbean in March...
LANG: Yes.
SERWER: ... on your frequent flier miles, I mean forget about it.
HEMMER: You said it.
SERWER: You cannot.
LANG: It's true.
SERWER: You just can't do it. I mean it's just ridiculous.
LANG: Yes.
SERWER: So what are some of these interesting programs?
LANG: Well, there are a lot of partner programs that are being developed and actually one thing that's coming along that's kind of interesting here is that they're working with completely new businesses. So they're partnering with eBay. They're partnering with Chase Travel. There are ways that they're letting you use this as though it's cash.
Now, it's not all free and there are a little, there's a little bit of a caveat here in terms of getting the value out. Consumers have to be a little bit wary.
SERWER: Right. Frankly, I find these things so confusing. I've got tons of different airlines, different credit cards, different phone plans. I can't keep track. The only thing I check is to make sure they're not expiring, and none of them do. Of course, JetBlue came out yesterday with a program that expires in 12 months. I think that's a little onerous. I don't think they're going to have much luck getting people doing that, do you?
LANG: Well, if they would let you use it the way that you want to use it, that expiry, I think, would be fine. It's just that they're, they do have all of these conditions and blackout periods, so it would be tough.
SERWER: Right.
LANG: They would face a real backlash if they suddenly took away our points.
SERWER: Right.
Let's talk about renting cars. I mean this blows my mind. A new study out showing that people are still getting those waivers, paying unnecessarily for this. It blows my mind.
LANG: Well, this is actually an interesting little consumer issue here. I've run into this, where you get one quote on the telephone, you go to pick up your car, it's an entirely different amount, and they say well, it's the insurance. And you say well, I don't want the insurance, give me whatever your bare bones minimum is. And then the person explains to you that if anything happens to this car you're going to owe them $50,000.
SERWER: Yes.
LANG: And you say all right, give me the insurance.
The issue here, of course, is protecting yourself by educating yourself.
SERWER: Right. Basically, if you have in car insurance, I mean check on this, but if you have car insurance, you don't need the damage waiver.
LANG: No.
SERWER: That is if you get a reservation. My favorite is we have your reservation but someone's already taken the car.
LANG: Yes.
SERWER: Do you ever see that sign?
LANG: I did.
HEMMER: That's so (UNINTELLIGIBLE).
SERWER: I mean that's, no, you've got to, you're not holding, you took the reservation. It's holding it is the important part, as Jerry Seinfeld said. I love that one.
LANG: Yes. No, it's true. The other thing, of course, is that a lot of our credit cards offer insurance. It's worth looking into.
SERWER: Right. Right.
All right, Amanda, we'll check back in with you later.
LANG: Sure.
SERWER: Thank you very much.
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