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Sunday, February 10, 2008

FREE Airplane Ticket from Ryanair

FREE Airplane Ticket from RyanairRyanair, an airliner in Ireland, lets some fly for free. And, if all goes well, they will be able to allow more people to fly for free. How is the business model for a free airline supposed to work? Since the revenue does not come from the ticket sale, the revenue comes from:

1. Refreshments: No free peanuts here, any food or drink will cost you (sales: $61 million)
2. $3.50 to check your bag ($36 million)
3. Online links: Most flights are booked online, and by providing links to hotel and other partners, they earn money ($100 million)
4. NASCAR style: They sell space on the sides of planes to advertisers to display ads

"Michael O'Leary, Chief Executive of Ireland's Ryanair, Europe's most profitable airline, wants to make air travel free. Not free as in free from regulation, but free as in zero cost. By the end of the decade, he promises, "more than half of our passengers will fly free."

The remarkable thing is, few analysts think his prediction is far-fetched: Ryanair already offers free fares to a quarter of its customers.

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