1. PBTA Education Day Business Travel Coalition  April 21, 2010  Philadelphia Airline Unbundling: Historical Footnote or Business Model Step-Change?

2. Like A Rocket Checked baggage Seating Upgraded meal Complexity Cost Data

3. Airline Industry Background

4. Financial Risk Profile

5. Balance Sheet Analysis Losses last 10 years of $63B domestically Underpriced product by 11% $21B in new costs is coming on line Airlines are $50B in the hole Ten years ago airlines had 28% equity vs. 4% today

6. A Closer Look At Unbundling

7. Phase 1: Basic unbundling Phase 2: New added-value services Phase 3: Expanded 3rd party services Phase 4: Rebundled packages of services Phase 5: Door-to-door innovation Phases Of Unbundling

8. New Business Models

9. No Slam Dunk Consumer backlash Government intervention Loss of corporate support

10. 1. Full content 2. Not undercut the value of corporations’ contracts 3. No discrimination 4. Respect managed travel efficiencies 5. Avoid “free-rider” problem Policy Standards

11. Technical Standards

12. Two Paths

13. PBTA Education Day Business Travel Coalition  April 21, 2010  Philadelphia Airline Unbundling: Historical Footnote or Business Model Step-Change?