After months of speculation by frequent flyers of both United MileagePlus and Continental OnePass, United Continental Holdings has announced the details of the 2012 MileagePlus loyalty program. Overall, the differences between the existing program and the new MileagePlus program are modest, but there will be members who will fare better under the new program and members who were better off with the old program. Jeff Foland, President of Mileage Plus Holdings, was quoted by the Chicago Tribune as saying that the new program is “designed to reward our highest-value frequent travelers with the highest level of experiential benefits and highest reward utility.” The flip side of this is that less frequent flyers will receive fewer perks and low-level elite Silver members will be losing some benefits with the new program.

The Continental OnePass program will formally end on Dec. 31, 2011. The exact dates when all of the changes that constitute the new MileagePlus program will be implemented has not been announced, but it will be during the first quarter of 2012. Some changes will go into effect on Jan. 1, 2012, while most will take place when the technology systems of United MileagePlus and Continental OnePass are converted to a single system. Until the system conversion is completed, the programs will continue to operate separately and elite members will receive all of their current benefits. We’ll outline the changes below and point out who are the winners under the new MileagePlus program and who will end up with the short end of the stick.

ALL MEMBERS

If you don’t have plans on reaching elite status in the MileagePlus program, then you won’t see many changes when the OnePass program ends and the MileagePlus program becomes the frequent flyer program of United Continental Holdings. Former Continental OnePass members will need to remember that miles in the new program will expire in 18 months without any qualifying activity. Expiring miles is never a positive change, but it’s easy to keep your miles from the chopping block. For example, one option to keep your miles alive is to sign up for MileagePlus Dining Rewards. The Continental OnePass dining program ended on Oct. 31, 2008 and members have been unable to earn OnePass miles for dining at participating restaurants for the last three years. United MileagePlus continues to partner with Rewards Network and members can visit http://www.mpdining.rewardsnetwork.com to register for MileagePlus dining. Be sure to provide a valid email address and opt in to receive emails and you’ll earn three miles per $1 spent. If you don’t opt in to get emails, you’ll only earn one mile per $1 spent. This is a very easy way to keep your MileagePlus account active. Also, a single purchase at the mileage mall will reset your mileage expiration date by another year and a half.

Flight Bonuses

Effective Jan. 1, 2012, mileage bonuses for purchasing more expensive flights will be increasing. Members flying on United and Copa Airlines in full-fare coach (Y, B) will earn a 25 percent bonus, discounted business (Z, P) will earn a 50 percent bonus, full-fare business (J, C, D) and two-cabin first class (F, A) will earn a 75 percent bonus and three-cabin first class (F, A) will earn a 150 percent bonus. Currently, MileagePlus members only receive a 25 percent bonus on business class flights in J, C or D and a 50 percent bonus in F or A. There are no losers here–United is seeking to reward members booking flights in higher fare classes by awarding additional miles for purchasing more expensive tickets.

Standard Awards

When the system conversion is complete, MileagePlus general members will lose the option to redeem more miles for last seat availability with the Standard Awards option. Last seat availability will be offered exclusively to elite members and MileagePlus and OnePass credit cardholders.

At one time, Delta eliminated last seat availability when the program had SkyChoice awards, but then brought them back with a three-tiered award structure with the highest awards being offered without capacity controls.

United is the only U.S. program to introduce capacity controls on its Standard Awards for non-elites and members without a co-branded credit card. While Standard Awards are more expensive and generally not a good value, they can be very useful if you need to travel at the last minute and non-elites who want this flexibility will now have to sign up for the credit card or work their way into the ranks of elite.

Economy Plus

There will be greater availability of Economy Plus seating for general members who choose to purchase a seat with more legroom in the front of the plane when making reservations. The lowest level elite members currently receive Economy Plus seating at time of booking but after the system conversion, only Premier Gold and above will be able to reserve these seats ahead of time, leaving more seats open for higher level elites and for purchase. Economy Plus seats start at $9 per flight segment on short-haul flights and even long-haul flights are relatively inexpensive. A one-time upgrade to Economy Plus on a Washington-Dulles to Paris flight is $99. Members can also choose to purchase a year of Economy Plus for $425. Members who purchase the annual Economy Plus option will be able to reserve seats in Economy Plus for themselves and one traveling companion when making reservations.

The winners of this new policy are higher level elite members and general members who choose to pay extra. Higher level elite members already received top pick of seats, but now that Silver elites can’t book until the day before, Gold and higher members who book earlier than one day out won’t be competing with Silvers for Economy Plus seating. Providing additional access to Economy Plus for elites flying 50,000 miles or more per year by restricting access to those flying 25,000 miles per year benefits those who fly more often. Entry-level elites, however, are not so lucky because they will have to wait until 24 hours before departure to receive complimentary seating in Economy Plus, which can only be seen as a devaluation of their elite benefits.

MileagePlus Auctions

Continental OnePass offers auctions where members can redeem miles for events and items such as tickets to sporting events, concerts or an autographed sports jersey. One highly publicized auction was a once in a lifetime round-the-world trip to visit the eight wonders of the world. United Mileage Plus launched an online auction site in 2005 where members could bid miles for items at united.com/auctions but the auctions tapered off and the option to bid miles eventually disappeared. The ability to bid miles for auction items will make a reappearance in January 2012 and members will be able to bid on sports tickets, cultural events and other experiences.

United Club

The United Red Carpet Club and Continental Presidents Club airport lounges have combined to form the new United Club. The change to the club lounges is primarily a name change–members and guests continue to receive complimentary drinks, snacks, free wireless Internet access, conference room access and more. There are more than 50 United Club locations in airports around the world and annual membership starts at $475 for non-elite members and you can also purchase a one-time pass for $39.

ELITE MEMBERS

Elite Levels
The new MileagePlus elite program will have four tiers instead of three. Premier Silver (previously named Premier) at 25,000 Premier qualifying miles (PQM) or 30 Premier qualifying segments (PQS), Premier Gold (replacing Premier Executive) at 50,000 PQM or 60 PQS, a new Premier Platinum tier at 75,000 PQM or 90 PQS and Premier 1K at 100,000 PQM or 120 PQS. Global Services will continue as before as an invitation-only level.

A new requirement to qualify for elite at any level is that members will have to fly a minimum of four paid flights on United, Continental or Copa. This is a reasonable change and will only impact those members who primarily fly on partner airlines and attribute their miles to United. An elite program is designed to reward loyal members who fly on the program’s airline so it makes sense that elite status will be given to members who are flying at least a few flights on United. American Airlines also requires its elite AAdvantage members to fly at least four segments on American, American Eagle or AmericanConnection.

Upgrades

All elite-level members will be eligible for instant upgrades from Y and B fares at ticketing and Premier 1K members will receive instant upgrades from M fares as well.

The upgrade order is changing and the hierarchy for upgrades at the airport will be Global Services, Y, B, M instant upgrades (ordered by fare class then premier tier), paid upgrades (including earned and mileage upgrades) ordered by status, fare class and waitlist date. All remaining members will be ordered by status then fare class. Upgrades will clear at the following times: 120 hours prior to departure for Global Services, 96 hours for Premier 1K, 72 hours for Premier Platinum, 48 hours for Premier Gold and 24 hours for Premier Silver.

The biggest change with the upgrade order is that elite status isn’t the only determining factor, unless you are a Global Services member. Elite members of any fare class who purchase Y or B fares and 1Ks on M fares will be next in line for upgrades after Global Services and after that, any member who “paid” for an upgrade with cash, miles or certificates. In other words, a general member who redeems miles for an upgrade will receive an upgrade before a Premier 1K member flying 100,000 miles a year will receive a complimentary upgrade. If the Premier 1K member is redeeming miles or an upgrade certificate, they will be first in the paid upgrade category, since status will count first within that category, before fare class.

Gary Leff of View from the Wing said, “This, to me, is the worst change of all” and that it is “a huge reduction in value for loyalty across the year rather than profitability on a single given trip by prioritizing full fare over status for upgrades, and prioritizing willingness for a member to spend miles on a single trip over status for upgrades.” While passengers on full-fare tickets and general members redeeming miles for an upgrade will now have a better chance of being upgraded, the result is fewer complimentary upgrades available for all elite members below Global Services.

Beginning in early 2012, Premier members who hold the MileagePlus Explorer Card will be eligible for Complimentary Premier Upgrades when flying on eligible economy-class award tickets on United. Currently, elite members do not receive upgrades when flying on award tickets and this new benefit is reserved for elite members who also acquire United’s co-branded credit card.

Premier Silver

Lowest tier Silver members will see an erosion of benefits with the new MileagePlus program. Silver members will only be able to check one bag for free with a weight limit of 50 pounds instead of the current two for free–but the biggest devaluation is that Silver members will have access to Economy Plus seating only 24 hours prior to the flight. All other elite members will continue to receive Economy Plus seating when making reservations.

For many members, Economy Plus is seen as a huge plus for the MileagePlus program. Because entry-level elites are the last in line for upgrades, they rarely get upgraded, and often end up in coach. Unlike other airlines without an intermediate section between coach and business class, United has an Economy Plus section and low-level elites could rely, at the least, on up to five extra inches of legroom. But even this perk is endangered and they won’t know until check-in whether they’ll be seated in Economy Plus or at the back of the plane. Milepoint member Mackieman expressed his disappointment with his comment, “While most of the changes make sense, for me personally, it is a major bummer to see that Silvers lose the ability to select E+ at booking. I’m sure most folks (especially those of a higher status) don’t care, but that was the single biggest draw of my loyalty (meager though it may be) to the company.”

The elite bonus will remain the same and Silver members will continue to earn a 25 percent flight bonus. Silver members will also still earn 500 minimum miles on short hops; priority waitlist, check-in, baggage handling, security line, boarding and phone line; better availability of coach saver award inventory (a new benefit) and unrestricted access to Standard Awards, access to most sold out flights; Star Alliance Silver status; discounted lounge membership fee; reduced award fee of $50 for changes and close-in booking and a $125 redeposit fee (a $25 savings).

Premier Gold

Premier Executive members currently earn a 100 percent mileage bonus but when the program is relaunched, Gold members earning 50,000 miles per year will only earn a 50 percent mileage bonus. The mileage bonuses offered by the new MileagePlus are identical to those offered by the US Airways Preferred elite program, but elite members flying 50,000 miles a year on Delta and American earn 100 percent bonus miles. Premier Gold members will only receive half as many miles as they are accustomed to earning, which means a flyer who requalifies for Premier Executive with 50,000 flown miles will earn 25,000 fewer redeemable miles in 2012, not an insignificant amount. And members who were expecting to receive one set of benefits will receive a different set of benefits with the new program. Milepoint member catgirl said, “It just plain sucks for the 1Ps and the 2Ps who qualified for 2012 status under the current scheme and the changes to the MileagePlus program are taking effect Q1 2012. Would be better and more fair if it were 2013.”

Premier Gold elite members and above can continue to check three bags for free with a maximum weight of 70 pounds each. In addition to Silver benefits, they’ll also receive reduced fees of $25 to change an award ticket or book a close-in award ticket, a fee of $100 to redeposit miles, and there is no fee to make same day flight changes. As a Star Alliance Gold member, they also receive lounge access when traveling internationally. Also, upgrades for Premier Gold members will clear as early as 48 hours instead of the longer 72-hour window they had previously.

Premier Platinum

Premier Platinum is a new level and members will earn a 75 percent mileage bonus, which is 25 percent fewer miles than they would have earned as former Premier Executive members. Premier Platinum members receive better availability of saver awards in all cabins (not just coach) and waived award and phone booking fees. Fee waivers and additional award inventory used to be offered only to 1K members so these are new benefits for those flying 75,000 miles or more. Premier members will earn two Regional Premier Upgrades (RPUs) when they reach 75,000PQM or 90 PQS, plus two more for each 25,000 PQM or 30 PQS thereafter. A new benefit for Platinum and 1Ks is compensation for the $100 Global Entry application fee. Global Entry is a service that allows pre-approved travelers expedited clearance through customs upon arrival in the U.S.

American Express also added complimentary Global Entry access as a benefit for Platinum and Centurion cardholders earlier this year.

Premier 1K

Premier 1K members will continue to earn a 100 percent bonus. They also receive Regional Premier Upgrades, 1K dedicated phone line and a $60 statement credit for MileagePlus Chase credit cardmembers. Premier members earn six Global Premier Upgrades (GPUs) when they reach 100,000 PQM or 120 PQS, plus two more for each 50,000 PQM or 60 PQS thereafter.

Lifetime Elite Program

Another notable change is the new lifetime elite program that will begin next year and as a one-time adjustment, all EQMs dating back to the beginning of the OnePass and MileagePlus programs will be combined and count toward lifetime elite status. Shannon Kelly, Director, Customer Insights and Metrics posted on milepoint that “as part of the one-time adjustment, all elite qualification earnings dating back to the beginning of the Mileage Plus program will be added to your lifetime balance–including partners, fare class bonuses, double/triple EQM promotions, and bonus miles from credit cards.”

The new program, however, will be based on actual flight miles starting on Jan. 1, 2012. Members who fly one million miles will receive lifetime Premier Gold, two million flown miles will equal lifetime Premier Platinum, three million earns lifetime Premier 1K and four million equates to lifetime Global Services. Million mile benefits will also be extended to a qualifying member’s spouse or significant other. Partner benefits will be identical to those the member receives with the exclusion of RPUs and GPUs. And Continental’s Infinite elite members will receive lifetime Premier 1K status, but no GPUs.

United MileagePlus members will be able to earn the program’s highest level of recognition, Global Services, by flying four million miles or more. Compared to other programs, offering the highest level possible is generous. American AAdvantage members can obtain lifetime Platinum at three million miles but not the highest Executive Platinum and Delta SkyMiles members can earn lifetime Medallion status at four million miles but lifetime Diamond Medallion remains out of reach.

Reactions to the new lifetime elite program have been mostly positive. Seth, who writes the Wandering Aramean blog, said “The MM program update is, by far, the most compelling offering out there. Wow. Just wow.” But not everyone was enthusiastic and some members saw this announcement as a blow to the program since more members would be qualifying for lifetime elite status, which would dilute elite benefits such as upgrades for other members. Milepoint member tommy777 lamented, “What a devaluation of the MM program! Global Services is now obtainable at 4MM?? Holy smokes, I just flew by a million miles without doing nothing and I’ve only flown UA since moving to the U.S. in 2006. Good luck getting those upgrades in the future.”

PARTING WORDS

For general members of United MileagePlus, the changes to the program are Much Ado About Nothing. For Silver members, it’s a Comedy of Errors and for Premier 1K and Global Services, it’s As You Like It, mostly. While not everyone is happy with the new program, one of the rumored changes that many members feared–that the elite program would be partially based on revenue spent–did not materialize. We can’t predict yet how all of the changes will play out and whether the change in the upgrade hierarchy will substantially impact how often higher elite members receive complimentary upgrades, but we hope that All’s Well That Ends Well with the new United MileagePlus.