QUOTE(seantang @ Oct 24 2012, 12:05 AM)
MAS has been traditionally servicing domestic interstate and pendalaman routes as national service. But this is a commercial international route. No way this will be construed as a "social service".
Where did you get the idea that Firefly is allowed to earn cost of capital only? It's part of a listed company with shareholders. It's not a public utility or public transport operator. International airfares are not regulated.
As for the argument it is a monopoly, I remember reading the valid counter-argument that although it is the sole provider of Ipoh-Sg flights, it is not the only provider of commercial passenger transport between Ipoh-Sg. The express bus service carries far more passengers at a much greater service frequency and it is these buses which are the actual/traditional "public service" or "social service". Firefly is positioned as a niche and premium service, aimed at high value customers who are looking for convenience not provided by the bus service. It is therefore fulfilling a "discretionary want" rather than "basic need" by providing a service that was not available before and as such is not displacing the existing public good ie. the express bus service. And there is alternative air service flying to Sg from KLIA.
But ultimately you are right. The Ipoh-Sg route is Firefly's cash cow. It is normally 75%+ filled even on weekdays, in both directions. It subsidises the highly competitive routes like KL-Sg and lower passenger load routes like Sg-KB where prices are low to put bums on seats to earn a small margin above variable cost to keep their fleet's operating rate high.
I disagree with how the business model is run by Firefly and worse it is left unchecked for balances and price stability.
The airline matrix is more or less defined by SIA at today's competition level.
Sia - long haul premium
Silk air - short haul premium
Scoot - long haul low cost
Tiger - short haul low cost
Their business models are less vague and any profit beyond the cost of capital wouldn't be priced initially on a demand basis but looking into the premium services that is offered or any ancillary revenue available. An as demand grows, price will be increased gradually, at least for the low cost carriers.
Firefly is different and they are re defining the business model. Get a monopolized air travel route and priced the "premium" at launch. The premium is defined as discretionary want as you rightly put. That's what I am uncomfortable with. They are left unchecked by any regulators or operators when being a monopoly on the air route. Clearly I am not blaming Firefly but the regulators and operators for their lack of initiatives.
I was using social service because I am a consumer and protecting my self interest. But yes, as a public entity they deserve to earn beyond their cost of capital. I rant because firefly is abusing their first mover advantage with no proper monitoring.
MAHB could have lengthened the runway and allow tiger or airasia to serve the route. The renovation of the terminal is secondary.
This will not happen in Australia and Europe. Action does not necessarily require volume there all te time.
I don't have the volume to increase the awareness. Perhaps the Alvin and Vivian method could work. For all intend and purposes, I just need some place to rant.
This post has been edited by keelim: Oct 24 2012, 08:40 AM 
Oct 24 2012, 01:55 AM
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... then you can talk about this firefly thing during all the ensuing print/radio/whatever interviews 
the only place i find safe to booze..ing in JB is 'TGIF'
of course, career progression has been limited... only so-so CO ard.. you win some lose some lo...not forgetting "chap-fun" at $2.70, no erp, travelling time 40mins between causeway...all this just for a higher spending power during weekends/public holidays in m'sia
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