| Welcome to Bw Reads, our weekend newsletter featuring one great magazine story from Bloomberg Businessweek. Today is one of the busiest flying days of the year, which means you might be reading this while squished in the middle seat, drinking a thimbleful of ginger ale while hoping the Wi-Fi holds up. Or maybe you've paid extra to avoid all that. Amanda Mull recently wrote about why the front of the plane is now a haven of luxury, while coach has turned into a low-cost shakedown. You can find the whole story online here. If you like what you see, tell your friends! Sign up here. Nothing is more valuable on a plane than space. There are mathematical reasons for that, but if you've ever spent hours stuck in a middle seat or had the person in front of you demolish your knees while shooting backward into nap mode, you also just know it in your heart. Every inch of cabin space is carefully meted out; there's no wiggle room, literally. And some of the ever-dwindling inches between you and those in adjacent seats have been sold twice. Who gets to use the armrest depends on who's most game to make enemies. Knowing all of this, maybe it's not surprising that a substantial number of people say they'd be willing to buy into a more pleasant setup. But even the airlines have been surprised by exactly how eager Americans are to pay for more comfort. Before the pandemic, the biggest US carriers spent more than a decade experimenting modestly with fare offerings beyond first class and coach—say, a few rows with extra legroom and better snacks. But premium seats have never been top sellers. Delta Air Lines Inc., for example, sold only 14% of its first-class fares for cash in 2011. Across the industry, that grew steadily leading up to 2020, but most of the best seats still weren't bought, only exchanged for miles or given as upgrades to road warriors with airline clout. When leisure travel began to tick back up after the pandemic, Americans were no longer crossing their fingers to get a better seat for free. By 2023, Delta was selling 74% of its first-class seats for cash, a jump that reflected trends throughout the market. According to industry research firm CAPA-Centre for Aviation, North American premium fare volume in the last quarter of 2023 was up more than 36% over the same period in 2019 on the busiest routes, even as overall volume was stagnant. That growth can't go on forever, but it's been enough that carriers are rushing to add new types of cabins or more rows of upgraded seats across their fleets. United Airlines Holdings Inc., for example, is expanding premium inventory by 75% per flight as part of a program announced in 2021. In October, Delta said its entire fleet would get "nose-to-tail" cabin redesigns in the next few years. These changes don't just mean more first-class seats; they also signal more types of premium cabins in more price tiers, all offering slightly different combinations of space, comfort and perks. In the meantime, airlines are piling benefits onto existing premium fares—better food and wine, kits full of high-end toiletries, gratis socks and slippers. But for passengers at the back of the plane, all of this talk of upgraded comfort might sound like trolling. Flying in coach now means being antagonized at every turn—by extra fees for all kinds of things that used to be included, by the shrinking seat real estate, by overstuffed overhead bins, by the dwindling odds of ever getting to sit next to a blessedly empty seat. So is flying getting better, or is it getting worse? The forefather of modern airline premiumization was TWA, which was the first carrier to take advantage of a regulatory change that allowed US airlines to separate passengers into multiple cabins, creating the first real premium seats in 1955. At the time a federal board set fare prices across carriers, and flyers everywhere on the plane had the same seats and the same amount of space. Because ticket prices were consistent among carriers, airlines competed with one another by piling on perks aimed at the business travelers who then made up about half of the flying public. Pan Am, in particular, was famous for having carving stations and cocktail lounges on long-haul flights. When the industry deregulated in 1979, it cemented the delineation of premium and coach classes across the airlines. Once carriers were allowed to compete on price, the perks and roomy seats began to vanish. (Today, flyers have 3 or 4 inches less between their seatback and the one in front of them.) Upstart carriers—many of them short-lived regional brands such as Air Vermont or Golden Gate Airlines—poured into the market, prices fell, and airlines looked for ways to fit more people onto planes to keep revenue up and satisfy demand. As long as tickets were affordable, the new passengers could be coaxed on board without tons of amenities; flying from Cleveland to Myrtle Beach, South Carolina, was better than driving. Still, the skies have remained disproportionately populated by business travelers, who are individually many times more valuable to an airline than anybody headed to a girls' weekend in Miami. To keep them from straying to competitors, carriers invented loyalty programs and their rewards—most notably, frequent-flyer programs and miles. When upgraded seats were bought outright, it was usually by business travelers. But that doesn't mean no one else was interested—it just means airlines dithered, unsure of exactly how big the leisure upgrade market was or how to reach it. Until relatively recently, people booking their own tickets for pleasure travel didn't get much of a pitch about why they should upgrade, says Gary Leff, an industry expert and proprietor of the website View From the Wing. "It's never really been well-marketed," he says. Then, suddenly, the most reliable customers vanished from the skies. When conventions and client visits became Zooms in 2020, airlines slashed prices and devised strategies to get people to book at the front of the plane. Typically, premium fares make up 3% of traveler volume but account for 15% of passenger revenue, according to International Air Transport Association data. When revenue was especially scarce, cutting those fares by half or more to entice first-time upgraders was still preferable to having them sit in coach. Now that travelers have had a taste of the good life—particularly those who skew female and younger than pre-pandemic upgraders, according to Delta—many have opted to continue buying, even as discounts have vanished. Airlines now also have a treasure trove of data about the pitches, amenities and prices that convert people into premium ticket buyers. Keep reading: Why the Flying Experience Feels So Much Worse And for more: 32 Rules for Flying Right Now | 
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