What Earnings Season Reveals About Travel Right Now

0:00Seth Borko: ZS is a global consulting and technology firm that partners with companies to improve life and how we live it. Working with the world's top hospitality brands, ZS brings together data, science, technology, and human ingenuity to transform ideas into customer loyalty. They're ready to help you elevate guest experiences, improve operations, and uncover preferences and motivations through their AI-powered solutions. With more than 1 ,700 clients in over 170 countries, ZS has built the expertise, fortitude, and vision to help you deliver impact right where it matters.

1:01Seth Borko: The number of the week is$1 billion. Yes, I maybe should try to sound a little bit like Dr. Evil when I say that, but it is$1 billion. That is the valuation of a travel company named Fora. It is a travel advisor platform. It just raised$60 million in financing. That gives it that$1 billion valuation and makes it our latest. travel unicorn. So that is what happened this week. We got a whole bunch of other stuff going along this week. You know, you may notice for those of you watching, I'm in a different location this week because I actually, I actually am on vacation. I actually am at the beach this week.

1:44Seth Borko: So Seth tells me there's been a lot of stuff going on, but why don't you inform both me and the people?

1:49Sarah Kopit: Yeah, Sarah, they let you take a vacation in the middle of earnings season. you're allowed to do that. They did.

1:56Seth Borko: They did. Yeah. Yeah, they did.

1:58Sarah Kopit: Oh, that's why we got a great team, right? Yeah, exactly. How is your vacation going, by the way?

2:04Seth Borko: It's fantastic. We have one. So this, as many of you have heard me talk about, this is my big birthday girls trip with all of my friends that I've had since I was in elementary school. So we have one more joiner today. She'll be the last one, and then we'll be a full group of 11. So it's been great. Amazing.

2:23Sarah Kopit: Amazing. Yeah, we're in the Outer Banks.

2:26Seth Borko: Yeah.

2:27Sarah Kopit: I really want to go to the Outer Banks. I've never been. I would love to go.

2:31Seth Borko: Yeah, it's so nice. Big short-term rental territory.

2:33Sarah Kopit: Big short-term rental territory.

2:34Seth Borko: It is. It is. We're at one of our friend's houses. This is where her house. And yeah, you know, it's just a lot of... I mean, it's definitely... I mean, for anyone who's been here, it's definitely like Northeast Beach. Like, it's very similar to the beaches of... like the beautiful beaches in, you know, Delaware and New Jersey and even, you know, out on Long Island. But we saw some dolphins the other day, which made me comfortable to go in the water because whenever I see dolphins, I think, okay, there's no sharks. I only like to see sharks when I'm scuba diving. I don't like them when I'm swimming like in the murky surf.

3:10Seth Borko: So anyway, so that's that. That's my story. That's how vacation is.

3:14Sarah Kopit: That's a great story. I love it. I love dolphins. I love to see dolphins. It's amazing. I did pick a lot of our stories this week and it actually is a genuinely very busy news week. I feel bad saying the word genuinely to just sidebar because it feels too AI, but I am saying that it's a genuinely busy news week. That forest story is fascinating to me because I feel like we haven't had a lot of travel startup unicorns lately. We had this moment and it feels like it really peaked. And the fact the data shows it did peak during the pandemic when all of these startups and all this money and Airbnb really led that charge.

3:49Sarah Kopit: Then Airbnb went public and they're doing great. We had a couple others that went public that didn't do so great, RIP, you know, Sonder and some others. And I feel like it's been a little quiet on that front. And so I was really excited. I mean, this actually just happened, I think it was announced a week or a week and a half ago, but our CEO, Rafa, just did some analysis on Fora. Fora is a super interesting business because out of all these, what is the the most future thinking forward looking sector to build a startup in travel agents travel agents and they did it in travel agents and these are not online travel agents these are actual human travel they prefer to be called advisors travel advisors but for is building this sort of digital ai forward ai first dare i say ai native i don't like the word ai native but dare i say it um travel platform to basically make it so that young people and part-time people and sort of i don't want to call it uberification but these people who are uh wouldn't otherwise have considered travel agency or travel advisory as a business yeah are able to do it and they don't need to be trained on the global distribution system the gds they're building their own platform And it's pretty fascinating.

5:07Sarah Kopit: So this is like a AI, you want to talk about AI killing jobs. This is in some way sent AI reviving jobs, bringing jobs back. I'm being dramatic for bringing jobs back from the dead. Any real travel agent worth their software will correctly tell me that it was never really a dead job. But did you ever watch the Americans? I loved the Americans.

5:28Seth Borko: I just every time every time I hear about travel agents, I just always think of them. for all of you listening who are travel agents or travel advisors i also really secretly think that you're russian spies so um and a lot of i mean this

5:46Sarah Kopit: 15 000 russian spies i think there are 50 000 employees at for uh you're trying seth is working

5:53Seth Borko: really hard to try to think of a transition out of that but i've given like an impossible an impossible task here. I'm going to let you struggle. Continue. Go for it. Let's see what you can do.

6:05Sarah Kopit: Speaking of spies, Amazon's Alexa device, which is a listening device that people put in their phones. There you go.

6:13Seth Borko: There you go. Alexa as spy. I love it. Yes, he did it, ladies and gentlemen. He did it. Yeah, I know, right? Alexa is here for all of us,

6:26Sarah Kopit: listening all the time we have another skiff news story out this week i think really fascinating and worth discussing about how amazon is making a bet on conversational bookend conversational commerce writ large but with actually with travel really at the center of it and trying to embed amazon wallet and mcp that's model context protocol for all you uh ai nerds out there it's basically how AIs speak to or non-nerds out there. It's how AIs speak to one another. And so Amazon is making a run at doing conversational travel partners. We report in SCIFT that the early partners are going to be Priceline, Viator, Virgin Atlantic, Lyft, Brightline, my favorite, Flixbus, and Greyhound.

7:15Sarah Kopit: So it's a nice mix of planes, trains, and automobiles, distributors and suppliers for this opening launch. What's your take on this one, Sarah?

7:26Seth Borko: Sounds like there's some big travel booking. Well, first of all, it sounds like there's some big players that are missing from that list, but we could talk about that in a minute. But, you know, Alexa, I mean, the way that I think about any of the conversational, like, natural language, AI bots, I mean, you know, you just use them in your own life, right? Alexa is a pretty good one of all of them, I would say of anyone who. Like, I very rarely yell at Alexa in frustration. Like Alexa seems to I don't know, maybe it's just because Alexa listens all the time. So they so Alexa can like hear hear my voice and knows my voice.

8:09Seth Borko: But I mean, yeah, look, if you could if they can do it, if they can get the tech to to work or you can just like have a conversational natural language, you know. query or transaction with Alexa to actually book travel. I mean, that's like the whole ballgame, if it works.

8:30Sarah Kopit: It's interesting. I think conversational is one of those things that a lot of forward-thinking folks in tech are really excited about and talk a lot about. And I have to tell you, I'm not a skeptic per se, but it's one of those things that has consistently fallen short. and everyone always says, but Seth, but Seth, mobile bookings eventually got there. And that's true, but there's plenty of things that did not, mobile succeeded where many, many, many, many, many technologies.

9:00Seth Borko: And you're a skeptic just because of that work, like if it works type thing, like it just doesn't work all the time for everybody. I mean, I have a friend who is from Sri Lanka and who was, you know, educated by some Swiss nuns. Like she has a very distinct accent. Like when she speaks English and like she can't talk to any computer. She said it just it doesn't work for her. It doesn't understand her.

9:32Sarah Kopit: You know, there's not a lot of Swiss Sri Lankan nuns in the training data or. Yeah.

9:38Seth Borko: Yeah. Well, but to be fair, like when I listen to her, like she speaks the Queen's English to me. Like that's what it sounds like to my ear.

9:48Sarah Kopit: Yeah, but I also think people really want options. You know, one of the things that we're finding in our research, and this is forthcoming, but I'll give you a preview for our podcast listeners, is that as we give people more tools, it doesn't get easier. They get analysis paralysis. And so we're giving people more tools. And what people are not doing is substituting AI search for Google search. What they're doing is not an or equation. What they're doing is an and equation. They're doing the Google search. Then they're doing the AI search. And then they're doing the social media search. And then they're doing the review search.

10:19Sarah Kopit: And then they're doing the OTA search. So the process is only getting more complicated. And the power of voice and conversational is that it simplifies everything. That is the dream. And yet everything about travel seems to suggest that, well, I should be specific. It's hard to simplify. There are certain trips. You know, you and I, if we had to go to Megatrends in London, Sarah, like we could probably book that one with our voice. But to plan a girl's trip to the Outer Banks probably can't be done in a voice conversation. You probably want to have a hundred.

10:51Seth Borko: Nor would you want it to. That's the that's kind of the other thing, you know, you know. And I quibble with your phrasing about the have to go to megatransit in London. We get to go to megatransit. We get to go to megatransit. We get to. I actually don't.

11:06Sarah Kopit: I usually don't get to go. You usually get to go. I don't.

11:08Seth Borko: I always get to go. Yeah. Maybe we should allow Seth to come. It's a good time.

11:16Sarah Kopit: But I would say one other thing. You know, one of the interesting things here is this is a bit of a trip down memory lane for me, which is that one of the very first research reports i ever wrote when i joined skift in 2018 was about amazon trying to sell travel and the idea was if everyone if you know google's got a google doesn't really sell at a search but if google's got a great platform and if the otas can do it and ever why can't amazon do it and they they've launched you know there is a whole history me and dennis can do a history of them trying to launch they launched flights in india where you could book flights.

11:50Sarah Kopit: I think it was Air India directly through Amazon India. They've tried to have hotels and even short-term rentals integrated onto the platform before. And every single time it's flopped. And the conclusion was that it was just, it's too difficult. It's too high consideration of a purchase. You know, there is a lot of expensive stuff that's for sale on Amazon, but the sort of the thing was there was a cap and there was too many variables, you know, Amazon at some point, and it actually might still be i should double check myself but there was a point where amazon was trying to sell cars and i think it might still sell you know costco does that sort of stuff too and although there are like a variety of trims and model years and whatever it's still like a straightforward like the complexity of travel has really stymied amazon and other third-party sellers the high price point the high consideration the high research burden slash joy like it's not always a have to something that's fun to do research has really prevented amazon from succeeding where it has in other categories like everything else everything else in the world yeah like taking

12:55Seth Borko: over the entire the entire capitalist ecosystem yeah and so this is a bit of a to me this is a

13:02Sarah Kopit: bit of a blast from the past in that alexa and even google voice is not new and there was a push to do voice travel and those all failed there was a push for amazon itself to do first party which is to sell travel and that failed and now to i guess i'm gonna make another transition this idea this joke of of ai is bringing these dead ideas back and not again not the travel agents but with aura to take ai is taking a travel advisory business which is a 50 year old business model and making it hot, sexy unicorn. And now Amazon, empowered by AI, feels the ability to try and resurrect an idea that died over a decade ago, or no, almost a decade, under a decade ago, and bring it back.

13:48Sarah Kopit: So I think that their context is also important for our listeners that like, this is not the first time Amazon has tried to sell travel. And it's not the first time, and they've certainly never succeeded before.

13:57Seth Borko: Well, if you think about it, like so many of the great minds of any generation really you know they're often ahead of their time right so you have an idea and you try it and it fails and then everything else has to catch up and then maybe you try out that idea again i mean we've seen that since you know the dawn of humans using the tools since the chimp with the

14:23Sarah Kopit: and that is an absolutely great point and like you know the dog of the first.com boom was quite literally a company called pets.com trying to sell pet food online and now there are multiple e-commerce businesses including amazon that sell pet food online to great success i was gonna say

14:39Seth Borko: why would you ever not order your pet food online kind of heavy you know and so now yeah i mean

14:47Sarah Kopit: And that's also sort of the genius and the beauty of a company like, you know, I'm not trying to be negative. I'm not anti Amazon, not not trying to be a Debbie Downer and everything I say. That's the beauty of a company like Amazon that has such staying power and such a bench of engineer in town is that you can have the idea. You can try it. And if it doesn't work, you don't go out of business. You just try it again when the technology evolves. And that is certainly what they're doing. They're chipping away at it. So pretty exciting stuff. What else?

15:15Seth Borko: What else happened this week, Seth?

15:16Sarah Kopit: Wait, can I share something real fast? Yes, of course. I'm going to share my screen. This was a report that I published in May of 2018 called Amazon Lessons, Threats, and Opportunities for Travel. And if we scroll down, what do we find? An analysis of, what else? Voice recognition technology and voice software and the role of smart voice devices in the future of travel. and talking about Alexa and could Amazon could use voice search. And we talked about adoption of voice technology, speaker-enabled use, and as a potential future. Now, we wrote that in 2018. And obviously, the voice recognition technology was going to be better there and was still nowhere near the level needed to have the confidence to book travel.

16:05Sarah Kopit: AI is a step function improvement of that. So I think it's also worth highlighting, maybe not as like they've done this before and it's a dumb idea, but also worth highlighting of one of the things we've heard at the at our data and i summits time and time again is that we are overestimating how much can be done in a year and underestimating how much can be done in a decade and this is an example of us talking about it and saying well here's this voice could could amazon use alexa to use voice to sell travels from out in 2018 and here we are in 2026 and they've got a live pilot that they're they're testing now so there you go

16:39Seth Borko: we should go back and see what else you talked about in 2018 stuff

16:44Sarah Kopit: uh and so our final big we have we have three big ai stories this week we had fora the ai power travel advisory uh becoming a unicorn we had amazon using ai powered mcps to sell travel bookends via a voice and alexa and the final one we had is quite exciting and it really does take us back into the world of hotels, which is a world we love, which is IHG. IHG Group launched literally yesterday. They just announced it, or by the time I listened to it, it would be earlier this week, a beta of conversational AI search on IHG.com. So I'm told not everyone has it. They're rolling it out across the website and the app.

17:28Sarah Kopit: But by the time you check, you should see that you should be able to have a bit of a a chatbot AI interface. And instead of doing keyword search, you should be able to have a conversational search where you talk with IHG about what kind of trip you want, where you want to stay, what kind of hotels you want, and it gives you the answer back in a conversational format. So our boss, Rafa, has talked about the tyranny of the search box. We at Skiff Research have talked about moving from search-led to curation-led, from search, scroll, to ask and decide. And this is part of that slow but steady transformation.

18:10Sarah Kopit: What's your take on this new tech watch from IHG, Sarah?

18:14Seth Borko: The tyranny of the search bar. I kind of love it. I mean, again, the thing that strikes me is just how similar the two stories are with Alexa and search and Google and IHG being just conversational voice search. I mean, it's just one of those things where it seems like so much innovation, even if you have things like trade secrets and walls and like between different companies, it's just people do come up with the, like they get there at the same time, a lot of times. You know, and it's not an accident that all of this is coming. So I think that, you know, I take when you hear these stories taken together, it just seems like to me, my read is, okay, there's going to just be now an avalanche.

19:09Yeah.

19:10Seth Borko: Of these type of, you know, and ones that probably work. Because they've been around for a long time. I mean, it's not like this is like new, new. It's just that it hasn't worked very well. And it's super annoying and people don't like to use it. We'd rather type it because you get a better experience. But if, you know, the big boys are putting big money behind this now, there's probably a pretty good chance that it works pretty well. Yeah.

19:39Sarah Kopit: And this IHG, it follows similar kind of chatbot tools that have been launched by Marriott and Hilton as well. And so now IHG, Hilton and Marriott all have these sort of conversational search chatbots on their homepages. Alexa has the conversational voice search and Fora has the humans who I'm told you can also have a conversation with a human. I haven't had one in forever, but I'm told it can happen. and so we are very much moving what my takeaway from all these stories that all came out in the last either this week or in the last 10 days or so but all point to this idea and actually something that i was talking about with some of my partners that we work with at mckinsey and their travel practice and i'll give them a shout out i think some of them are listeners hopefully but they've been talking with this idea we've been talking about about there's no longer a single front door there used to be one front door and that front door was a company called google and yeah great vehicle for that front door was that search bar and now what we're seeing is that front door can be a human travel advisor powered by ai that front door can be a voice search through amazon or another third party that front door can be a conversational search on directbrand.com and so i think that's what's the theme besides ai which is an obvious theme The theme that ties all these stories together and we see this trend sort of convergent is that there's no longer a single front door, whether it's a type of search or a place to search.

21:07And increasingly, how people are going to decide, book, search, discover, learn, research, whatever, is going to happen across multiple formats and across multiple locations.

21:19Seth Borko: I wonder how that to bring back the like decision paralysis or choice paralysis. I wonder how that were I mean, for like you and I. That sounds fine. Like, that sounds great. Like, you know, it doesn't phase me so much. But I think, you know, I'm not like a typical traveler. Neither are you. And so I think about like what that's going to be like for, I don't know, like our parents or people who are not so like, like, like it's taken 20 years to get Google like into their, into their, into their workflows. Like how, how is, I don't know. I think about it for, for them and other people who just, they're like, I don't, I don't, I don't want all this stuff.

22:01Seth Borko: I just want to, I just want it to work. I just want to know how to do it.

22:05Sarah Kopit: I mean, I think, well, that's also why I would not count out a player like Google. There was actually a small piece of Google news about Google actually as part of this IHG launch, about Google integrating IHG as its first hotel partner into what they call, I think it's called their direct offers program. It's going to surface hotel promotions inside AI assisted trip planning conversations. If I read that in my notes, it's a lot of big words,$10 words in my notes, but uh it's going to do something to that effect and i think that's why like everyone's like oh google like quad perplexity open ai there's going to be some question of are people going to like what i would say to the gist of what you're saying which is that if people can train to use google and you can take one of these models and plug into google why wouldn't i just use the model on google because increasingly i don't have a choice when i go to google i get ai answers and I'm increasingly going to add mode.

22:59Sarah Kopit: And so the thought about like the boomers or not even the boomers, but just people who are not seeking out AI tools, increasingly the AI tools will seek them out, if that makes any sense. And that's one of these big beats, which is.

23:12Seth Borko: And a lot of times they don't even know they're using them.

23:14Sarah Kopit: That's right. Yeah, absolutely. Absolutely. That's scary. And that's one of these questions, too, which is like Vulcan.com, Expedia.com, these major brands. people think they're going to get disintermediated by AI. They think that Claude and Chachavity is a threat to Expedia. And Glenn Fogel is out there at every chance he can get. And maybe he's right. He's a smart guy saying, no, they're going to come to us and we're going to use the AI when they come to us. Not that they're going to go, you know, they're not going to go to, because they already come to us and they know to come to us and they know to work with us and we'll buy the AI tools and then they'll come to us and we'll bring the AI to them.

23:53Sarah Kopit: As opposed to the customer leapfrogging them to get to Claude or whatever. So what you've just said is a great debate of, and it won't be over in a year as that old research report goes. It's going to be a decade before we even get close to knowing the answer.

24:13Seth Borko: Yeah, yeah, yeah, yeah. So we had some other things going on. We had earnings season this week, as you noted.

24:21Sarah Kopit: I mean, as we said last week, we're big urgency since fans. I don't have my EBITDA mug. I just have a regular mug. Did you see them?

24:29Seth Borko: Do you have an EBITDA mug?

24:32Sarah Kopit: It's an aspirational mug. It's a... I've bought it. I've lost in the move. I got to buy a new one. I got to buy a new one.

24:40Seth Borko: Of course you do. Sorry. Carry on.

24:44Sarah Kopit: No, did you... I mean, I know you've been on vacation, so I won't get too much on the spot. but have you had a chance to look at Hilton's earnings? I think you might find it incredibly.

24:53Seth Borko: I did. I did. I mean, I haven't stopped smiling since. I don't know. I mean, so basically Hilton, I mean, now keep me honest here, but Hilton cut one of their franchise fees for the first time.

25:11Sarah Kopit: Yes. Yes.

25:13Seth Borko: So this is something that we've been talking about for a while this year. I've been writing a lot about it and just about like the, you know, the squeeze that the hotel owners are under Hilton and the big brands are all making gazillions of dollars. Like they're doing really well. Their stock prices are all time highs. The owners are feeling the pinch. Everything's more expensive. It's harder for them to make money. And so that's the squeeze. And Hilton came out and said, you know, we're going to, we're going to do a little something like We're going to cut the fee. And they have done some kind of more ancillary things around the edges to attempt to make things easier for the owners.

25:58Seth Borko: But this seems like a much larger jump, like a bigger acknowledgement that this is a real problem that they have to fix.

26:08Sarah Kopit: And you know what surprised me? And again, I want your reaction to this. They did it so publicly.

26:13Seth Borko: Yeah. I mean, look, I think they had to. They wanted to. I mean, this has been a bad look for them. I mean, like, say what you will about, you know, like we talk about fiduciary duties and responsibility to make money for their shareholders and all of this stuff. But at the end of the day, hotel owners, for the most part, are small business owners. and it's like a David and Goliath kind of thing and Goliath is winning like hand over fist and so I think it's a bad look and I think that they're trying to do some damage control.

26:49Sarah Kopit: Do you think there's a chance it could be also a competitive move? Like in the perfect world, in a perfect economics world

26:56Seth Borko: if this is not working, they should be cutting prices

26:59Sarah Kopit: to attract more hoteliers to their flags to earn more franchise revenue in the long run and undercut their competitors. So I wonder, too, you said not only do they have to, they want to. I kind of think they wanted to advertise this. I think this is a big somewhat of an advertising message of this is out there in the zeitgeist. Sarah Copin and Skift are making it, are putting it out there. And we have a response, which is join Hilton.

27:26Seth Borko: Yeah, I think that is absolutely right. And, you know, they have all, you know, Chris Asada has said before that he knows that their future, that they, meaning the royal they, their company, Hilton. And Hilton's, you know, success is inextricably linked. I believe those are the exact words he said, that their success is inextricably linked to that of their owners. and so you know I think that back when he said that which was a couple it was either the last quarter or the quarter before you know they hadn't come out with this type of program yet but I think that you know here we are I think when when you have that knowledge you know it's only a matter of time before you know if things continue to to go down the path that they have it's only a matter of time until you've got to make a change.

28:24Sarah Kopit: I have a lot of respect for Hilton and for Nassetta too and I have a lot of respect for the competitors as well but I think one of the things I saw in this story is that they are discounting fees for hotels that score well on guest experience. So I think that's a really smart way to structure it too where it's not just about giving hoteliers a break It's also about giving hoteliers an incentive. And I think it's a very smart structure. At that same earnings report, they raised their RevPAR, Revenue Per Available Room guidance. So they upped their guidance. They called it a big turnaround. They had non-luxury RevPAR grew.

29:03Sarah Kopit: Luxury RevPAR continues to be strong. Even business RevPAR grew. So they raised their full year guidance. They saw a contribution from the world. I don't know. Pretty good quarter. Damn good quarter.

29:14Seth Borko: I mean, as it has been lately, like it always has.

29:18Sarah Kopit: So, yeah, slightly more mixed quarter at JetBlue, our airline friend, one of our New York hometown airline. They continue to lose money. They continue to be one of the least profitable airlines in the in the country. And they are still unprofitable, whereas many of their peers are struggling with not making enough profit. they are actively losing money that's can't be a comfortable place to be sitting but the stock price is up and the stock price is up because they announced a pretty major restructuring and turnaround plan which is i think significant because again you know and are we trying to play too many favorites or whatever on this podcast but i should say although jet blue is definitely struggling i am rooting for them as someone who spends a lot of time in new york city and long island city specifically we're rooting for them i want to i don't want to see them go out of business and so they re have reorganized and restructured their fair and in addition to a bunch of other stuff i mean they're they're moving terminals they're buying up uh spirits old slots they're taking advantage of that consolidation they're they're cutting routes they're investing in the routes i think are most profitable it's florida it's florida and they've done a new fair structure too and they're going to start offering much more domestic first class and also more different branding and more ancillary selling of their seats.

30:41Sarah Kopit: So they're really pushing. I mean, yeah, think about it. New routes, new gates, new fare classes. What more is there to new lounges? What more is there to an airline than all of those things? It's almost a new airline at that point, other than the planes themselves and the pilots.

30:58Seth Borko: I mean, just having watched how kind of just how impactful it was to lose spirit. I can't imagine if we lost JetBlue too.

31:11Sarah Kopit: It's on the table. There's no doubt about it. Yeah, yeah, exactly. Yeah.

31:17Seth Borko: From a just purely from a pure play competition perspective. I mean, how many low cost carriers do we have? Black, Southwest, Frontier, I mean, in the US anyway. Jet Blue.

31:29Sarah Kopit: Southwest, which is moving upscale. Jet Blue, which is moving upscale. Frontier Allegiant, which is merging with Sun Country. Oh, yeah.

31:38Seth Borko: I forget. I've never flown them. I kind of forget about them. Neither have I. Because I'm over here. Yeah. We're over here.

31:44Sarah Kopit: You know, I think it's arguable whether of the Alaska-Hawaiian combination deserves to be called a low-cost carrier or not. Alaska has some legacy as a low-cost. But arguably, that's it. I mean, I'm sure I missed this one. we want to hear from you give me an angry email if i miss tell us yeah you got delton united doing great at the top you've got american airlines which is certainly not a low-cost carrier but being squeezed maybe the least profitable of them you've got these in-between folks who are trying to figure out what their model is going to be that's alaska which as a reminder owns uh the former virgin and uh hawaiian you've got uh jet blue and southwest we're sort of getting squeezed in the middle and then you've got these more low-cost allegiant and allegiance Sun Country and Frontier who are hanging around but not um not having a great time and then you've got Breeze you know David Nealman our friend our friend David Nealman's uh Breeze which has actually been a very successful low-cost carry but they're still very small and their whole their whole strategy is I'm paraphrasing is uh is I'm paraphrasing their strategy and I'm also paraphrasing I think Peter Thiel who said competition is for suckers and their strategy is specifically not to, is to compete in markets that are not served by other airlines, which defeats the whole purpose of having low cost competition, which Jeff, what the beauty of what JetBlue does, the beauty of what Frontier does is they go into New York City, they go into Fort Lauderdale and they undercut the big guys and Breeze doesn't want to do that.

33:14Sarah Kopit: So the folks who are actually willing to get a little dirty, rough and tumble, David and Goliath, as you would say, are, David is under pressure.

33:25Seth Borko: Yeah, and I just, just a shout out to Frontier. Your livery makes me happy every time I see it from the window. The animals? The airplanes. Yes. Yes.

33:35Sarah Kopit: I like the animals too.

33:36Seth Borko: Yes, the animals. Yes, I have my favorite.

33:38Sarah Kopit: Other things that make me happy, Jeopardy's new LaGuardia terminal.

33:44Seth Borko: Ah, yeah, the marine terminal, our favorite. Yeah, I can't wait to see what they do with it.

33:48Sarah Kopit: If our listeners don't know what it is, I mean, explain to our listeners what the marine air terminal is.

33:52Seth Borko: So for one thing, for those of you who have not had the privilege to fly into LaGuardia recently since COVID, you should just because LaGuardia used to be, I mean, I can't or I won't say online what I hear live what LaGuardia used to be like. It was not good. And now it's absolutely beautiful and amazing. It like was a phoenix. It rose from the ashes of COVID and is now just a wonderful place. But that's like those are the main terminals. But at LaGuardia, they have this like funky little, it used to be the commuter terminal from New York to Boston, I believe. And then Spirit took it over. and it is an art deco building it is the tiniest thing like for a the reason why it's so unusual is because for a new york city airport you feel like you are going through like the traverse city airport in in northern wichigan right it's like it's like there's just this little teeny weeny little place like you can there can't be even be a long line for security there's nowhere to have set line it's that small but the building is cool and it's um there's only i don't know if i had to guess i would say there's four gates in that i had a guess yeah if that i mean and and it's it's

35:18Sarah Kopit: i think it's just a gem and it's been this like hidden gem hidden secret in la guardia because there's always a short line there's not a lot going on there's all the crowds no it's not your modern like um i mean like a singapore or an abu dhabi yeah it's just gonna say there's no fancy glass waterfalls or shopping malls or caviar bumps but it is a beautiful art deco masterpiece that was built by pan-american airlines which is another great speaking of defunct airlines but a great airline and i'm very glad to see it yes yeah hopefully jet blue gets it in the spirit bankruptcy yeah exactly that's been great with it yeah um sarah you've got a to get back to.

36:05Sarah Kopit: Should we do winners and losers real fast?

36:08Seth Borko: Let us do winners and losers real fast. And then, yeah, I got to go to the beach. I got to go to the beach. I've got, I got. I got a loser.

36:14Sarah Kopit: You got a winner?

36:16Seth Borko: I do have a winner. Let me. Yes, I do have a winner.

36:20Sarah Kopit: We learned our lesson. I'll do my loser first.

36:21Seth Borko: Okay, you do it.

36:22Sarah Kopit: My loser, and I'm sorry to say this, it's Royal Caribbean. This is another earnings story we did. They missed earnings. Well, actually, they beat earnings, but they trimmed their growth forecast and their fuel costs were up and they they blamed it on the iran war and fair enough i understand you're not you're not a loser at your core this was outside of your control but temporarily hamstrung by the iran war and we joked about how delta reported earnings and said iran war what iran war well the iran war is back in the news headlines it's back it's back in oil price markets and it's so funny we went to about airlines but there is another company that another sector of travel that relies very heavily on fuel to get you from one place to the other and that is cruise companies and rural caribbean seems to be a bit of a a victim to this and so you're not fundamentally a loser rural caribbean but you are that's tough that sucks

37:23Seth Borko: that's a tough week yeah so my winner this week is the space people and i will tell you why the space people. I kind of consider myself a space person or a space, a wannabe space person. I'm just a fan girl. I'm a space people fan girl. So Secretary Duffy announced this like new streamlining process for commercial space licensing. So what, yep. So what, you know, it, you know, as, as everything it it's complex it's more complex but what they what the trump administration ended up doing is kind of backtracking on a lot of environmental protections and rules that had been instituted in order to expedite commercial space licensing which hopefully uh for you like the goal of the administration is to just cut red tape and to get, you know, more satellites, rockets, you know, more, more business in space, like the business of space will be easier and quicker.

38:36Sarah Kopit: Do you think, would you, we'll get space tourism? We'll get that.

38:40Seth Borko: So, I mean, this is of course my, my, this is of course my dream is like, you know, I, I always, I always like talking about this stuff but space tourism i don't know i feel like it i feel you know what i think happens first is space business travel like that's like that's what i think is first i think that like if if like if skift is going to start writing about space the reason why it's going to be for from a business travel perspective not from a tourist perspective because I think that because that's what's happening first like you've got to build that you know you're going to build the infrastructure you're going to build if you're going to build mines and you know you're going to put mines on the moon and and all that stuff you you are going to send people to do it so that's what I think comes first but no I mean I I think it's a no-brainer I think that human beings want to explore and like once once that infrastructure is set up i think people are going to want to go to space as tourists i agree and i think too

39:54Sarah Kopit: you know i and i want to say like people soft these days but we take for granted how safe everything is there's people traveled a lot when you know in the age of steamships when those ships could sink and you would still take a vacation so i think that and for business and so i suspect you I appreciate your long term. One of the themes, it wasn't written out in our notes, but one of the themes of this episode is clearly long term thinking and overestimated in one year, underestimated in 10 years. And a lot fits into that. All right. Space people win this week. I love it, Sarah.

40:28Seth Borko: Space people. All right. Well, I'm going to go to the beach. Say hi to everybody. Yeah.

40:35Sarah Kopit: I will say hi to the folks. You enjoy the beach. And if you're listening, we'll see you next week on the Skip Trail podcast.

40:40Seth Borko: See you next week, everybody. Bye.

41:10Seth Borko: improve operations, and uncover preferences and motivations through their AI-powered solutions. With more than 1 ,700 clients in over 170 countries, ZS has built the expertise, fortitude, and vision to help you deliver impact right where it matters.