December 28, 2010  |  permalink

The Master Plan: Building A Smarter Favela


(Originally published at on December 27th, 2010.)

IBM is announcing this morning an agreement with the city of Rio de Janeiro to build a “Single City Operations Center,” or what amounts to a control room for the sprawling megalopolis. The center will draw upon data from dozens of municipal departments and public agencies.

While the system will initially focus on predicting the kinds of mudslides and floods that killed hundreds last April and left 15,000 homeless, it’s designed, ultimately, to monitor and respond to any type of emergency—just in time for the city to host both the 2014 World Cup and 2016 Summer Olympic Games.

The deal is IBM’s most ambitious smarter city project to date; previous efforts have tended to be single-purpose programs in developed cities, such as a congestion pricing scheme for London or water management in Dubuque. But Rio is a different situation—a bona fide megacity in one of the world’s fastest growing economies, in the midst of a multi-billion dollar infrastructure upgrade ahead of the World Cup. Although financial terms were not disclosed, the deal illuminates just how indispensable IBM hopes to become to the daily operations of Rio—and how it plans to do the same for cities everywhere.

The company’s involvement began in May at the behest of Rio mayor Eduardo Paes, who admitted after April’s mudslides that the city’s preparedness had been “less than zero.” The disaster cost roughly $13 billion in damage, while another 10,000 homes in Rio’s favelas were considered to still be at risk. “[Paes] was very nervous about a repeat the following year,” said Guru Banavar, CTO of IBM’s Smarter Cities group. “He said, ‘Help me deal with these floods before the next rainy season,’ which meant right now.”

IBM’s consultants were happy to help, although they had more than just software in mind. To make the most of their solutions, they recommended an overhaul of how the city’s weather, geological, and civil defense agencies operate, essentially forcing them to work together.  “The ideal situation would be to appoint a sort of chief operation officer who would coordinate across multiple agencies,” Banavar said. “To my surprise, the mayor took that advice very seriously, and within a couple of days had appointed a COO.”

“This is a very special thing for IBM, because we’re seen as a trusted advisor by the mayor—not a vendor, not even a partner,” Banavar continued. “He absolutely takes us with him for most of the city-related decisions. It’s a very close relationship that has pretty much transformed the organization model for the city of Rio.”

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December 28, 2010  |  permalink

The Master Plan: The Battle For Control Of Smart Cities


(Originally published at on December 16th, 2010.)

Who will own the brains of smart cities—citizens or corporations? At stake is an impending massive trove of data, not to mention issues of privacy, services, and inclusion. The battle may be fought in the streets between bands of Jane Jacobs-inspired hacktivists pushing for self-serve governance and a latter-day Robert Moses carving out monopolies for IBM or Cisco instead of the Triborough Bridge Authority. Without a delicate balance between the scale of big companies and the DIY spirit of “gov 2.0” champions, the urban poor could be the biggest losers. Achieving that balance falls to smarter cities’ mayors, who must keep the tech heavyweights in check and “frame an agenda of openness, transparency and inclusivness.”

Those are some of the conclusions of “The Future of Cities, Information, and Inclusion,” a 10-year forecast commissioned by the Rockefeller Foundation and published this morning by the Institute for the Future. “Without this catalyst for cooperation,” the authors conclude, “we may repeat the devastating urban conflicts of the 20th century that pitted central planners like Robert Moses against community activists like Jane Jacobs.” Befitting the Foundation’s focus on the world’s poorest and what it calls “smart globalization,” the report’s emphasis is on smartening up cities in the developing world—cities that lack both data about their swelling populations and the tools needed to make sense of it. The roster of expert contributors comprises a who’s who of ubiquitous computing and gov 2.0 types, including MIT Senseable City Lab director Carlo Ratti, Everyware author Adam Greenfield, the Santa Fe Institute’s Nathan Eagle, Intel Labs Director Genevieve Bell, Microsoft Research’s Jonathan Donner, and San Francisco CIO Chris Vein.

Together, they highlight five “technologies that matter” for cities in 2020: mobile broadband; smart personal devices, whether they’re dirt-cheap phones or tablets; government-sponsored cloud computing (modeled on the U.K.’s national “G-cloud” initiative); open-source public databases to promote grassroots innovation, and “public interfaces.” Instead of Internet cafés, imagine an outdoor LED screen and hacked Kinect box allowing literally anyone to access the Net using only gestures.

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December 28, 2010  |  permalink

Ad Age Insights: Global Media Habits 2010

(One of my fall projects was a special report for Advertising Age on media habits around the world. What belows below is from the Introduction. The complete report is available for $249 from

The first thing you should know is that the name of this report is the Global Media Habits survey. While we’ve been obsessed with the carnage in the American and, to a lesser extent, European media markets, for the last couple of years the global media landscape has mirrored the broader economic one–which is to say, developed nations are fragmenting while developing ones are booming across the board. This is as true for television and newspapers (newspapers!) as it is for online video and mobile phones, the latter of which is poised to become the most ubiquitous media device in history.


This bifurcation in media reflects another in the world at large. Not just marketers, but governments (e.g., in Britain, France, Greece, etc.) are slashing budgets and announcing austerity measures while ministers in New Delhi and Beijing (not to mention their corporate counterparts in Mumbai and Shanghai) are calling for massive increases in spending to reach a middle-class consumer who literally did not exist 20, 10 or even five years ago.

In a country like India, for example, two middle classes actually co-exist–a prosperous middle class by any measure (with an average income between that of the typical Brazilian and Italian) and an emerging middle class earning anywhere between $10 and $100 a day per person. The group making up that middle class accounted for one-third of the world’s population in 1990, but 57% by 2006, according to Indian economist Surjit Bhalla. That growth hasn’t been linear. If one graphs the average income of the world’s consumers, the middle earners comprise a large bell curve, while the top 1% and “bottom billion” form long tails on either side. That bell curve is moving en masse into the emerging middle class, creating a media boom in the unlikeliest of places….

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December 13, 2010  |  permalink

The Jevons Paradox: The More We Save, The More We Burn


In the new issue of The New Yorker, David Owen dredges up “the Jevons Paradox,” named for the Victorian era British economist William Stanley Jevons, who worried about “peak coal” a century before Americans began fretting about peak oil. Owen’s story is still behind the paywall at the moment, so if you’d like to learn more about the Jevons Paradox (and you should), here’s a brief excerpt from Aerotropolis:

Six years later, the British economist William Stanley Jevons declared another long emergency. The Coal Question, published in 1865, was An Inconvenient Truth for Victorian England– a clear- eyed description of Britain’s looming peak coal reckoning, complete with a sobering analysis of the country’s coal reserves cross- referenced with its ravenous consumption. The country would run out of coal in less than a hundred years, he estimated, and the result would be cataclysmic. “It is the material energy of the country– the universal aid– the factor in everything we do,” he wrote with spooky prescience. “With coal almost any feat is possible or easy; without it we are thrown back into the laborious poverty of early times.” Once Britain had run out, its ability to sustain 10 percent population growth each decade (as it had done for the previous seven) would collapse under its inability to grow or transport enough food. Worse, there appeared to be no alternatives– no fuels to replace it, in Jevons’s estimation– and any increases in the steam engine’s efficiency would only make it cheaper and easier to use, thus stoking greater demand and faster depletion.

These were not the ravings of a fringe theorist. Jevons was as sober and as mainstream an economist as any Nobel- winning member of the Chicago School today. His suggestion made its way on to the floor of the House of Commons, where no less than future prime minister William Gladstone– then chancellor of the exchequer– referred to the looming peak coal crisis in his bud get speech of 1866. A “coal panic” ensued, leading to the appointment of a blue- ribbon royal commission. Five years later, it published the first detailed estimate of Britain’s coal reserves but managed to sidestep Jevons’s conclusions altogether. The public went back to sleep. Britain’s coal did not run out, and the isles didn’t become fully reliant on oil until after World War I.

The “Jevons Paradox” still troubles us: The more efficiently you use a resource, the more of it you will use. Put another way: The better the machine, the broader its adoption. And there has never been a better machine for transportation than the jet engine. A pair of General Electric GE90- 115B turbofans mounted on a 777 are capable of generating 230,000 pounds of thrust between them– enough to propel four hundred passengers between New York and London in six and a half hours, with gas mileage equivalent to fifty five miles per gallon per passenger. But the aggregate cost is still staggering: twenty five thousand gallons of fuel ignited in the upper atmosphere. Fifty years of refinements have yielded engines cleaner by an order of magnitude, but any gains in efficiency have been far outpaced by exponential growth in the number of passengers– the inevitable result of falling costs and ticket prices.

The Jevons Paradox illustrates why infinitely renewable, zero- carbon fuels are a necessity– because merely efficient solutions only postpone the day of reckoning. Peak whale teaches us how an entire way of life underpinned by a single source of energy can be transformed or vanish overnight thanks to timely substitution. If you had told Herman Melville in 1851 that whaling would be a historical footnote within a decade–replaced by viscous tar oozing out of the ground– he would have been dumbfounded. “One day the planks stream with freshets of blood and oil,” he wrote in Moby-Dick, and the next day, they were gone. How could he have imagined the sweet crude yielding light, flight, locomotion, and the Green Revolution?

Peak whale ended when whalers “ran out of customers before they ran out of whales,” quipped the environmentalist Amory Lovins, who was charting paths to a renewable future before Jimmy Carter wore cardigans in the White House. So how will peak oil end?

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December 10, 2010  |  permalink

John Stuart Mill, Doomslayer.

“I think I have observed that not the man who hopes when others despair, but the man who despairs when others hope, is admired by a large class of persons as a sage, and wisdom is supposed to consist not in seeing further than other people, but in not seeing so far.”—John Stuart Mill, from the debate speech “Perfectability,” May 2nd, 1828. It was recently quoted with admiration by Bill Gates in his “debate” with rational optimist Matt Ridley.

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December 09, 2010  |  permalink

Advance Praise for “Aerotropolis”

In case you missed it, the early word on Aerotropolis is in, and it’s glowing with praise:

“Thanks to the manifold effects of modern aviation, earth and sky are merging in our world faster and more thoroughly than most people know. But you won’t be most people after reading Aerotropolis. Throw out your old atlas. The new version is here.” – Walter Kirn, author of Up in the Air.


“Very few people realize how profoundly air transport is changing our cities, our economies, our social systems, and our systems of governance. If you want to be way ahead of the curve in understanding one of the most important drivers of change for the 21st century, read this book.” - Paul Romer, Senior Fellow Stanford Insitute for Economic Policy Research; founder of Charter Cities.

Aerotropolis redraws the world map, using air routes to trace the new connections and competition between mega-regions that will shape the geography of the Great Reset. This lively, thought-provoking book is must reading for anyone interested in how and where we will live and work in a truly global era.” - Richard Florida, director of the Martin Prosperity Institute, University of Toronto and author of The Great Reset.

“A fascinating window into the complex emergent urban future. This book is an extremely sophisticated, often devastatingly witty and ironic, interpretation of what is possible over the next two decades. It is not science fiction. It is science and technology in action. The authors have one foot firmly planted in the possible and foreseeable.” – Saskia Sassen, Professor, Columbia University, author of Territory, Authority, Rights.

“A wheels-up, clear-eyed, as-it-happens dispatch of the world being remapped by our just-in-time, frequent-flying, what-time-is-this-place society.  An essential guide to the 21st century.” – Tom Vanderbilt, author of Traffic: Why We Drive the Way We Do (and What It Says About Us).

Aerotropolis presents a radical, futuristic vision of a world where we build our cities around airports rather than the reverse. This book ties together urbanism, global economics, international relations, sociology, and insights from adventures in places that aren’t even on the map yet to present a plausible new paradigm for understanding how we relate to the skies. Perhaps the most compelling book on globalization in years.” - Parag Khanna, Senior Fellow, New America Foundation, and author of How to Run the World.

Aerotropolis comprehensively explains the enormous effects modern aviation has on cities and countries around the world. It is a unique resource.” - Frederick W. Smith, chairman and CEO, FedEx Corporation.

“The closest thing to a real-world vision to rival that of [H. G.] Wells… a mind-expanding ride that reminds us, once again, that humanity needs no apocalypse to reinvent itself and its surroundings.” - Thomas P.M. Barnett, author of Great Powers: America and the World After Bush.

“Fascinating… their case studies of failures, successes and known unknowns are music to a logistician’s ears: Why, for instance, should so much air traffic now pass through the Persian Gulf? Because the emirates are blank slates for the experiment, and, as one Abu Dhabi–based technologist says, “because we can fly nineteen hours nonstop now, we’re able to reach any city in the world from here.” The brave new world is on the way, and it’s coming in by air.” - Kirkus Reviews.

“The inevitability of an airborne future rests on economic but also human imperatives… But our increasing dependence on air travel is real enough, and this is an eye-opening picture of that trend.” - Publishers Weekly.

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December 03, 2010  |  permalink

From King Cotton to Cargo King

Interesting news from Memphis today— Dunavant Enterprises Inc., which sold off its cotton-trading operations earlier this year, has decided to refocus its attention on (you guessed it, assuming you know Memphis) logistics. Dunavant Enterprises was founded by the legendary William B. “Billy” Dunavant, dubbed “the Michael Jordan of cotton” by his peers. Years before Paul Tudor Jones made his first billion swapping commodities, Dunavant had built his small family business into an empire trading cotton. He was the first to trade cotton futures and the first of his kind to abandon “Cotton Row” along the waterfront for the area around the airport. His company’s decision to stop growing, making or trading goods to focus on transporting them instead is the story of 20th century Memphis in a nutshell. Before he retired in 2005, Dunavant pulled off on last big score, the second-largest single cotton trade in history. It was for $225 million, and the client was in China. That tells you all you need to know about where the cotton business ultimately went.

I mention all of this because it’s impossible to tell the story of Memphis (and FedEx) without telling the story of Billy Dunavant, which is why I began the second chapter of Aerotropolis with a visit to the Memphis Cotton Museum, with a cameo from Dunavant himself:

The trading floor of the Memphis Cotton Exchange sits at the corner of South Front Street and Union Avenue, overlooking the bank of the Mississippi River and the docks that once lined it. Plantation owners and their salesmen guided skiffs up and down the delta to those piers before dragging their bales across the road to the base of the exchange. There, beneath its vaulted windows, traders broke pieces off the soft piles and twisted them into ropes called snakes. They would hold these up to sunlight, judging the cotton’s color, quality, and seediness on the spot. “Spot trading” was their métier, buying bales already picked and packed, unlike their counterparts at the Chicago or New Orleans exchanges, who traded in futures– essentially contracts to deliver a later harvest at a set price.

Front Street was both the geographic and the spiritual center of Memphis’s cotton trade, and the center of the world’s until the 1970s– a strip of ware houses, dry- goods stores, barbecue joints, and diners populated by traders, bankers, Teamsters, and hangers- on all swapping gossip with discarded snakes underfoot. The exchange’s dues- paying members, fearing they had drifted too far from the street in their headquarters just a few blocks inland, decided in 1922 to move the trading floor back onto “Cotton Row,” into the base of an Art Deco tower built to house it.

Today, the Memphis Cotton Exchange is the Memphis Cotton Museum, the trading floor frozen in time and reconstituted as an average day in 1939. On the spring afternoon of my visit not too long ago, the exchange was empty of traders and visitors alike. Under brass ceiling fans and above the glass display cases was the original Big Board– a chalkboard fifty feet long and ten feet high, spanning an entire wall and rising to the ceiling. Chalkers, usually young men with deft hands, stalked back and forth along an elevated walkway, continually rewriting prices sent over the ticker from New York and Liverpool to the Western Union offi ce below. When exchange members spotted an opening for arbitrage or an untenable position, they strode to one of the four phone booths lining the far wall.

Mounted in each booth today is a small screen displaying a lineup of talking heads reciting the history of King Cotton in Memphis. One of them is a Southern gentleman well past retirement age named William B. “Billy” Dunavant, dubbed “the Michael Jordan of cotton” by his peers. “We used to consume eleven million bales of cotton each year,” he says through a molasses- thick drawl. “Now it’s six million. China used to consume fifteen million bales a year. Now it’s forty million.”

Dunavant liquidated his own firm’s physical position on Front Street in the early 1970s, moving to one of the broad, squat ware houses that had already begun sprouting like toadstools along the access roads just east of Memphis International Airport. He dismissed the rivals he left behind as “a bunch of old men gossiping,” A few members stayed in the exchange tower for sentimental reasons. Many others followed Dunavant’s trail to East Memphis, where the airport, highways, and rail yards had given birth to an entire forest of white, multistory ware houses adorned with the stubs of truck- loading docks instead of Art Deco flourishes. These were the spawn of a twenty- seven- year- old former marine pilot named Fred Smith, who moved home from Little Rock with his new company in tow, Federal Express.


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November 29, 2010  |  permalink

Head. Exploded.

“I rather expect the eco-ayatollahs to take a dim view of all my travels lately. But, hey, the planes were going to leave whether I was on them or not. And I was glad to see a far-off corner of the world that many civilians will never get to. So bugger off.”

- James Howard Kunstler, who spent the holiday in Perth, Australia—“the city comfortably most far removed from any other major population center on Earth.” This is a man who has spent the last ten years predicting the global airline industry would be dead within the next five years. At least he’s enjoying it while it lasts.

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November 29, 2010  |  permalink

Happy Cyber Monday!

Today is “Cyber Monday,” one of the busiest online shopping days of the year (although surprisingly not #1, for reasons I’ll explain below). In honor of the dubious “holiday,” Esquire tells of the story of the National Trade Federation executives who created it from whole cloth:


And so, in the summer of 2005, in the nondescript offices of a nondescript trade organization: a name. Blue Monday? Not enough cheer. Green Monday? Too hippie. Black Monday? Too confusing. “Cyber Monday,” then, would be a simple new holiday, a necessary one, to meet the demands of a WiFi-enabled gifting populus – but also something complex, less marketing myth than evolutionary consumerism, more Wikipedia than Hallmark.

Five years later, the NRF and its Website,, expects 106 million Americans to shop today, including more than half of all office workers in America. Nine out of ten e-tailers are offering Cyber Monday deals.

That’s on top of the eye-popping numbers posted over the weekend; according to The New York Times” “About 33.6 percent of weekend shoppers bought online, which, according to the federation’s study, is the highest percentage ever.” Online sales on Thanksgiving rose 33 percent over a year earlier, while Black Friday sales were up 15.9 percent according to IBM. Meanwhile, ComScore said online retail had already increased 13 percent in the first 26 days of November versus a year ago, to $11.64 billion. After several years of plateauing growth, it appears e-commerce is back and bigger than ever.

Anyone who started their holiday shopping early on Thursday should have given thanks not for Amazon’s patent on one-click shopping, but for FedEx, UPS and the immense hubs they’ve constructed in Memphis and Louisville, respectively (along with Indianapolis, Newark, Oakland, Ft. Worth, and Greensboro, not to mention Paris, Shanghai and Guangzhou) to process the tens of millions of packages those purchases represent. And those hubs, in turn, have attracted the country’s biggest e-tailers to set up gigantic distribution centers in their footprint, whether it’s Technicolor (which handles half the DVDs sold in America from its Memphis warehouse) or Amazon or Zappos (which runs a single, million-sq. ft. hangar south of Louisville). These are the cities shipping and handling built—what you get when you have to pump billions of dollars worth of online purchases through real, physical space—and they are the real miracles of e-commerce, not one-click.

How can I be sure? Because even as the Esquire story concludes that Cyber Monday might someday triumph over Black Friday as the biggest shopping day of the year, it acknowledges that Cyber Monday is not even the busiest online shopping day of the year. The crescendo of the holiday online shopping season is typically the Monday or Tuesday before Christmas—the cutoff for guaranteed shipping in time for the holiday. From Chapter 2 of Aerotropolis:

Speed has put the squeeze on retailers. E-commerce didn’t exist in 1995, but the first wave of e-tailers collectively racked up $7 billion in sales four years later. It was $155 billion in 2009, and it may top $250 billion a few years from now. An entire galaxy of one- click shopping has been summoned into existence, with Amazon poised to become the next generation Walmart in the eyes of Wall Street. A recent study by four economists at the University of Chicago found that Amazon and e-commerce have crushed small and midsize booksellers (along with travel agents and auto dealerships) as prices fell and bigger, more effi cient retailers got even bigger.

Two billion boxes land on our doorsteps each year, three- fourths of which have been sent either overnight or second- day air. E-commerce (and why call it that? Isn’t it just “commerce” by now?) at present accounts for 7 percent of all retail spending. Half of all Americans are online shoppers, spending an average of $1,006 per year. Jeff Bezos’s original prediction that it would eventually account for 15 percent of a multitrillion- dollar industry is well within reach.

What the Internet added to the retail equation wasn’t long tails and thoughtful comparison shopping, but the acceleration of impulse. Our increasing comfort with our digital selves– composed of Google searches, Facebook friends, YouTube clips, and tweets– awoke a belief in us that physical atoms should always move at the same light speed as our digital bits. The real breakthrough was our collective acclimation to this new degree of speed. Having settled into the fast lane, slowing down for even a second is viscerally painful, no matter what our speedometer actually says. As counterintuitive as it sounds, the best thing that ever happened to overnight mail was being made halfway obsolescent by e-mail. Our desperate struggle to accelerate everything else to the same velocity has only made us more dependent on its fastest physical analogue. And so our impulse purchases are increasingly accompanied by the equally impulsive selection of next- day air for just a few dollars more. And if our impulse was wrong we return the item on the seller’s dime.

The aerotropoli around Memphis and Louisville were created by those dollars. These are the cities “shipping and handling” built. In the business, those dollars are referred to as “value added,” an accounting term describing the money to be made from touching goods and improving them at the right time in the right place. Memphis and Louisville are where, in the United States at least, goods are tenderly massaged. These are cities made of hubs, one for each industry, or maybe more.

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November 29, 2010  |  permalink

Why’d You Pick That Airline to Fly on Thanksgiving? We Thought So.


(Originally published in Advertising Age, November 29th, 2010.)

NEW YORK (—“What does it take to fly?” Donald Sutherland intones over lush black-and-white images of Boeing 747s, jet engines, captains and crew in the first TV spot of Wieden & Kennedy’s campaign for Delta Air Lines. It takes headwinds, apparently.

“The thing you push against is the thing that lifts you up,” the actor continues. “So every challenge, really, is a chance to show that even in this crazy world of no-liquids, take-your-shoes-off, cost-cutting and route cancellations, someone in this industry still has the passengers’ back.”

Translation: You hate to fly, and it shows. After mid-decade brushes with bankruptcy, U.S. carriers are back in the black, packing them in and jacking up prices while slashing what’s left of the perks and replacing them with fees. One casualty of all the cost-cutting and mergers is ad spending—especially on TV—while the remaining holdouts hammer the fact that their bags, at least, fly free. So it’s odd to see a legacy carrier attempt to build a brand again.

“We wanted to start with the truth, and by acknowledging it, earn people’s trust,” said Ben Hughes, a co-creative director for the campaign, which features the tagline “Keep climbing.” But will passengers believe it? Or have they been too conditioned by packed planes, fees on top of fees, surly flight attendants and, now, the TSA’s “scope-and-grope” procedures, to think Delta and its competitors are all broken and all the same?

Last week marked the start of the annual holiday travel rush, with an estimated 24 million Americans taking to the skies over Thanksgiving, a 3.5% increase over last year. It’s been a banner year for airline profits despite the sluggish economy, following a period of consolidation in which Delta-Northwest, United-Continental, and Southwest-AirTran all merged. The survivors have since called a truce on ruinous fare wars, leading to the fuller planes, higher prices and ancillary fees adopted by most U.S. carriers that have become a fixation of both industry executives and passengers. U.S. Airways CEO Doug Parker boasted this month that a la carte pricing annually delivers $400 million to $500 million in pure profit. “If we didn’t have it, we’d be right back where we were before,” he said, “barely breaking even or worse.”

At the other end of the spectrum, Southwest Airlines made “Bags Fly Free” the focal point of $159.5 million in TV spending last year, according to Kantar Media—a figure nearly equal to the combined ad budgets of Delta, United, American and Continental.

Have the airlines really become so commoditized that paying $25 for a checked bag means all the difference? It seems so. Surveys by Forrester Research indicate advertising has an effect on only 16% of travelers making purchasing decisions. Their primary considerations include price, on-time statistics, airports served and nonstop flights.

“If you have no brand image,” said Forrester travel-industry analyst Henry Harteveldt, “you’re just one generic airline competing against another.”

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Greg Lindsay is a journalist, urbanist, futurist, and speaker. He is the director of applied research at NewCities and director of strategy at its mobility offshoot CoMotion.  He is also a partner at FutureMap, a geo-strategic advisory firm based in Singapore, a non-resident senior fellow of The Atlantic Council’s Foresight, Strategy, and Risks Initiative, and co-author of Aerotropolis: The Way We’ll Live Next.

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