I love this story, it is an example of many happenings in our world. I think the most important is as an example of ignoring the opposition’s assumptions and winning, easily. Also of evolutionary systems, how they can’t be controlled, the fact you can’t manage an economy even when you control all the elements, the evolution of social systems in an age of world-wide peer-to-peer communications, and others I will think about when awake some night.
Airlines thought they were in the transport industry, a way to go from city to city, and designed their routes and fares to optimize revenue from that movement of people here to there and back.
Airlines competed in the early days, and so developed incentive systems such as ‘air miles’, executive lounges, discounts to hotels, … to keep customers loyal. Air miles were marketing clever* and very popular because individuals were awarded them for business travel, airline’s most profitable class. To attract business travelers, they increased the air miles awarded for particular flights. Airlines sold air miles to other businesses for their use as incentives, and most of them also came to redeem them : air miles became exchangeable for other goods, a scrip**.
(Standard meander of history evolving, of a new part of the ecosystem beginning to produce enough energy flow to sustain new organisms, you should recognize this kind of thing in 2015. Those combined have at least as much influence on our future as everyone’s plans.)
So the usual nerdy, obsessed, strange-to-outcast*** kids decide to start gaming that system of air miles, advertising, special fares, bonus miles, … all aspects of that managed economy. ‘The Hobby’, they call it. The goal of each flight was to gain more points than the flight cost, not to go from A to B. They didn’t care where they went, the flight was just a way of earning points.
Hobbyists fly constantly. They live on their air miles, eat and drink in first class on their air miles. They write software tools to find heavily-discounted and clear-mistake prices. Those also show the airline price-setters don’t have good tools.
People learned from the pioneers, there was a flow of value to be had for paying attention to how you organize your flight. Email happened, then WiFi and then continuous internet, so exchanging ideas and opportunities got easy. The ever-growing group coalesced on the Internet, has meetings and training sessions, publications. It evolves to keep ahead of the airline’s changes to the rules, marketing campaigns, prices. It has grown into a large and enthusiastic group of gamers. They differ from other such groups of gamers and enthusiasts because their heroes are recognized in airports around the world.
In its contest with the airline, which would like to minimize the number of seats filled at a cost higher than the price paid + the cost of moving the traveler, the Hobby is wildly successful. The airlines make the game ever-more complex trying to prevent them, but these guys have time on their hands, all of those long flights they sit through. There are more of them, from simple numbers some are much more intelligent than the airline’s executives, many are definitely very motivated, and they share their thinking, one big team. Standard evolutionary arms race with distributed evolution attackers vs central direction defenders. Quite an unfair contest, with the airlines so handicapped by their cartel and government subsidies.****
The game of rulers is to get you to believe assumptions that favor them. In doing so, they make assumptions themselves.
Rules, regulations, assumptions and beliefs are daylight between understandings and a level of reality. Chinks to insert the pry bar. Holes in the armor plate. Missing abutments. Future consternations.
Minimizing the set of ideas in your mind that you can’t trace clearly down to bedrock minimizes your risk of surprise and allows choosing optimum paths into the future.
*Want to bet whether the marketing guys did the dynamic analysis of their new system’s evolution? Including in their model the development and growth of a parasitic class gaming their system? Professionalism doesn’t help, the German General Staff failed at one major dynamic aspect of their craft, logistics, when it decided to invade France and again in invading Russia. End-games can be a glitch.
**Scrips are often used to reward loyal customers, hard work, … (That was both good and funny, nobody laughed.)
***Nerd-standard is a stereotype, is only accurate at the beginnings, when the energy flow isn’t enough to sustain most people and the barriers require more effort to surmount than ‘normal’ people find worthwhile. Explorers are rarely well-adjusted folks, but look at the Indian kid starting a business on the ideas, he is back toward mainstream. Societies move from the edge, the center eventually follows. Value your explorers, they are making mistakes so you don’t have to.
****There are online multiplayer games that run bigger economies without those problems – they have free markets, not government subsidized monopolies.
The fact that the stewardesses are fans tells you a lot about airline management, I think.