The sad truth about airfares

Once upon a time, there were reasonably well-known ways to pay less for your airfare. Airlines had rules governing ticket prices, those rules were consistent across airlines, and almost everybody knew what the rules were. (If you booked further in advance, the tickets were cheaper. If you stayed a Saturday night, the ticket would be cheaper. That kind of thing.)

Those days, however, are long gone. Airline tickets are no longer priced according to simple rules: they’re dynamically priced according to insanely complex algorithms which, to the naked eye, make no sense at all. Cheap tickets still exist, of course—the problem is that there’s no reliable way of finding them. If you managed to luck into such a ticket a few weeks or months ago, good for you—but don’t for a minute expect that if you behaved exactly the same way today, then you would get a similar result.

A recent paper by Symeon Meichanetzoglou, Sotiris Ioannidis, and Nikolaos Laoutaris sums up the current status quo: “complexity asymmetry,” they conclude, “defeated the web.” The paper is based on a massive database of 1,449,349 flight tickets involving 63 destinations and 125 different airlines—and finds that even the most common-sense rules of airline ticket pricing are regularly violated.

For instance, let’s say you want to book a round-trip flight from Brussels to Stuttgart. The researchers studied six different airlines flying that route, with 619 different fares, and found that 24.5% of the time, it was cheaper to buy two one-way tickets (one from Brussels to Stuttgart, and one from Stuttgart to Brussels) than it was to buy a round-trip. And when they looked at airlines rather than routes, they found similar outliers: one Dutch airline was cheaper more than half the time when buying singles rather than round-trip tickets. (Especially, it seems, on the Frankfurt-Zurich route.)

More generally, as Mike Masnick found a couple of years ago, if you assume that pricing out a multi-city trip will give you a better price than buying a series of one-way tickets directly from the airlines, you might well find yourself thousands of dollars out of pocket. Not only that, but there’s also seemingly no rhyme or reason whatsoever when it comes to which flights get surfaced by which search engines. (I’ve even come across situations where search engines show me flight options I can’t find on an airline’s own website.) Basically, unless you have a Bloomberg terminal, it can be extremely difficult just to find out what all the various flight options are, let alone how much they cost. And even if you can work out which ticket is cheapest, by the time you add on all the extras for priority boarding or checked bags or in-flight WiFi, it’s still essentially impossible to work out which fare is cheapest all-in.

A few years ago, Delta got in trouble for showing higher prices to its frequent fliers than to everybody else; it blamed a “computer glitch.” Ever since then, conspiracy theories have abounded, especially among people who search for flights, find relatively cheap ones, and then find that the fares have suddenly increased when they decide to buy. Is it a good idea to use some kind of private browsing mode when shopping for tickets, so that the airlines can’t identify you and jack their prices accordingly?

The answer, frankly, is that although it won’t hurt if you do that, you’re going to end up outsmarted whatever you do. The airlines and flight search engines have infinitely more information than you do, and that information asymmetry is always going to work to their advantage. If you find a cheap fare, good for you; if you don’t, it’s not your fault. The system is rigged against you. The battle of consumers against the airlines is over. And the airlines have won.