Originally Posted by
bbtp
therein lies the fundamental problem w/ the airline industry as a whole (less of a problem for sx, but a major problem for all other airlines): the marginal cost of flying another passenger is 0. at the end of the day, if an airline still has empty seats, there's a nearly irresistable temptation to sell those seats at almost any price, however low (as long as the price covers the transaction cost of selling the ticket).
VERY astute observation my friend.. there is the elephant in the living room of airline capacity and pricing. This is why every flight is almost full, yet they're unable to make money. Priceline.com, et al have created a system wherein the airlines compete with themselves. This is part of the "re-regulation" I subscribe to, which is to say, get rid of the brokering of seats and have each airline, and only that airline sell it's own capacity.