Best Domain Registration

Before dealing with expired domains, you will need to learn and understand how you can use a domain expired name register to find the best and profitable domain names. A domain expired name register is a powerful tool that helps you in searching for the most meaningful expired domain names. It will also make the process of finding such names easier and flexible.The domain expired name register shows thousands of expired domain names belonging to .COM, .NET, .ORG, .BIZ, and .INFO domain names categories. This register will also display those domains that are pending renewal or deletion. Domains that are listed in a domain expired name register keep changing almost daily, as they are facing constant renewal, deletion or back-ordering. The expired domain register is well organized, easy to scan and search and it comes with a user friendly interface. Its advanced search and sort ability will help you easily find the expired domain name of your choice.A domain expired name register is a truly dynamic tool that never remains idle, even for a second; its database keeps changing and adjusting itself to accommodate new expired domain names. A typical register usually contains over 100,000 expired domain names at any given point of time. The register will monitor every available expired domain possible, and it will also sort them into a well organized category depending on its status, whether it is pending expiry or deletion.In life, finding a good expired name is very difficult, and it is almost like seeking out a small needle in a bag of haystacks. But, a domain expired name register will enable you to search efficiently through the entire list of expired names directory without wasting much time.Here is how a typical domain expired name register works and operates in the real sense:a) You will need to enter the search keyword based on your preference.b) Search keywords could be anything in nature. It could the name of a flower or a dictionary word.c) You can also search through a readymade expired domain names list to find the desired name.d) When you enter a keyword and hit enter, the domain expired name register will soon return with a number of names. Then, you can pick up a name and register it in your name.e) A typical expired name register will also allow you to place a backorder without paying an upfront fee.Apart from the above, a domain expired name register will also assist you in knowing the "whois" database of the domain, about the domain registrar who registered the domain and a brief history of past registration data. There are a number of domain expired name registers that operate online to help people find their expired domains. Some of them offer bare minimum services, by allowing to simply searching expired domain names, while many others operate on a small subscription fee basis. Before you use a domain expired name register, ensure that you choose the best of the lot that offers a host of services related to expired domain names and their registration.

WS Domain Registration

The story of the .ws domain extension begins with Michael Reed and Alan Ezeir the CEO’s and founders of GDI or Global Domains International which is the company responsible for registering the .ws extension. Michael and Alan were looking for an alternative that businesses could use as an alternative to the widely popular .com extension that exploded throughout the 1990’s.Both Michael and Alan took a look into country assigned domain extensions that are assigned by the IANA or Internet Assigned Numbers Authority. They are codes that are given to countries to use for the Internet such as .us for the USA or .au for Australia. They were searching for a country code that could be marketed globally as a popular alternative to the very well known .com extension.After much research they decided to focus all of their efforts on the tiny island of Samoa which is located in the deep South Pacific. With only a population of less than 200,000 people, the .ws domain was not used on a large scale and it seemed to be the perfect domain to market as the top level domain of websites. The .ws domain had the perfect branding power and appeal to do this with.Michael and Alan now had their plan laid out and set off on a trip to Samoa to negotiate contracts with the government and of Samoa. After many meetings they were convinced that they had them sold, but after going back to the states they found out their business proposal had been rejected and since the time had passed at least a half dozen other companies had a chance to pitch their proposals.Just before giving up Mike had an idea to contact a Samoan government owned technology company that was given the contract and placed a call to the General Manager. He knew that their ability to properly market the domain on a global scale would be very limited and he pitched to him the idea of starting a partnership. The company accepted the deal.Moving forward to November of 2000, Global Domains International had sold over 100,000 .ws domains to the customers in over 180 countries. Big names like Yahoo!, Cisco, Dell Computers and Intel are customers as well as many top fortune 500 companies that are buying up the .ws extension dailyThe Samoan company wanted to test them and see if they could produce 15,000 .ws registrations in three years and GDI was able to do it in the first month of business. Now they enjoy a percentage of all sales produced by Global Domains International and GDI now has an exclusive 12 year contract to distribute the .ws name worldwide.

CC Domain Registration Information

Internet marketing is probably the most dynamic job that anyone can wish for today. In Internet marketing, people get to promote people online, in an extremely different marketplace, where tastes come and go, and where you cannot predict who is accessing a website at the other end of the world. Internet marketing is highly volatile as well: what is today’s apparently big trend might be tomorrow’s major dud, and what is tomorrow’s major crowd drawer might be yesterday’s corny joke. Moreover, the Internet is a highly dynamic environment where people are linked closely to one another, so that once news about something leaks onto the Internet, it can spread like wildfire in mere minutes. This means that if you have something good to offer, the world can know about it instantly - but if you have a bad name building up for yourself online, people will shun you even before you step out onto the Internet arena.In order to best market yourself, you will need a good website that is well designed and easy to navigate. You will also need to have a good domain name that will separate you from everyone else and make you unique. This domain name has to be registered with a domain name registration service in order for you to formally pay your fees, and for other potential domain name buyers to recognize that the domain name is already your own and can no longer be bought. As an Internet marketer, you may need to find the best domain name registration service around, as there are now many domain name registration services available.First of all, do you need only a domain name, and to register it, or do you also need web hosting space? Some web hosts also offer domain name registration, and because these hosts need to make a living, they are tied up with reliable domain name registration services. You can take advantage of these packages in order to find a package that will allow you to save money in the end, and still have the domain name registration that you need. However, make sure that the same hosting service also has good amenities and features to go with its hosting plans: although some hosts will offer you a lot of web hosting space and domain name registration, you might have only one or two years to keep the domain name before it expires and you have to pay another fee.Second, what domain name extension are you going to apply for? Are you going to get a dot com, dot net, dot org, dot biz, or a country extension? For some hosting and domain name registration services, the fees will be the same no matter what your domain name extension letters are. However, for some exclusive domain name registration services, a country extension can be more expensive. You will need to scout for the lowest prices for the domain name extension that you want in order to get the best bargain for you.Take note, moreover, that some domain names can be more expensive than others because speculators believe that they will be bought by more affluent companies, thus bringing the domain name registration service more money. This brings us to the third qualification for a good domain name registration service: you will need to have a list of possible domain names with you, and then look for these domain names and their prices through the domain name registration service’s search engine. You will need to see which the best domain is for the best price in order to get a better bargain. Prices will differ from one registration service to the other, so you will have to look through as many services as possible until you find the best price.

Cheapest Domain Name Registration

When you have a cheap domain name, the next thing you think about is how to get a cheap domain name registration. But, if you have trouble getting that cheap domain name, you need to make sure you get the right information that will guide you to landing on a very good and cheap domain name. Firstly, it is good to establish what exactly is a domain name and why exactly it is important. When you want to have a website, you must come up with an address or a name that you can use to refer to your site. The name is called a domain name. You can get the name from companies which are licensed to offer the service. What you get from these companies is the registration service and you get to invent your own name.When you come up with a name and find that it is already taken, you can buy already existing domain names from domain name resellers. They are people or companies who own the names in bulk and are willing to offer them to the public at a price. Therefore, you can search your ideal domain name and get a good offer for it. This good offer is the cheap domain name. This market is a bit unregulated and demand for a particular domain name determines the price. But, before you even think of a cheap domain name registration, make sure that the name is appropriate or suitable for its function. There are several things that you need to consider while choosing a cheap domain name and they include the following.Firstly, let the name be short and clear. Nothing beats simplicity and if possible, cut all the technical details and let people identify with a name they can pronounce and remember. Let your business aspect come out from the cheap domain name. There are names that you hear about and they totally have no connection with the kind of business they represent. It is not easy to choose a name that meets these qualifications in an almost perfect way but, the secret is real simple. It is taking time and not rushing the process of cheap domain name registration. Many people get some of the best ideas after taking time to think about it. Let your business and personality inspire you to choosing the right domain name.Cheap domain name registration is done by registrars who are authorized by the internet governing body. You should therefore make sure that the company meets this qualification. The process is simple and your domain name has to meet the right requirements like the non use of symbols. You will then decide on which company has the best offers in terms of price and service. The internet will enable you search and know all you stand to gain when you have a cheap domain name registration with the particular company. You will be happy to make the right decision and there are no two ways about it, you have to have the right information about the process.

Credit card

Credit card
Credit cards are issued after an account has been approved by the credit provider, after which cardholders can use it to make purchases at merchants accepting that card.When a purchase is made, the credit card user agrees to pay the card issuer. The cardholder indicates his/her consent to pay, by signing a receipt with a record of the card details and indicating the amount to be paid or by entering a Personal identification number (PIN). Also, many merchants now accept verbal authorizations via telephone and electronic authorization using the Internet, known as a 'Card/Cardholder Not Present' (CNP) transaction.Electronic verification systems allow merchants to verify that the card is valid and the credit card customer has sufficient credit to cover the purchase in a few seconds, allowing the verification to happen at time of purchase. The verification is performed using a credit card payment terminal or Point of Sale (POS) system with a communications link to the merchant's acquiring bank. Data from the card is obtained from a magnetic stripe or chip on the card; the latter system is in the United Kingdom and Ireland commonly known as Chip and PIN, but is more technically an EMV card.Other variations of verification systems are used by eCommerce merchants to determine if the user's account is valid and able to accept the charge. These will typically involve the cardholder providing additional information, such as the security code printed on the back of the card, or the address of the cardholder.Each month, the credit card user is sent a statement indicating the purchases undertaken with the card, any outstanding fees, and the total amount owed. After receiving the statement, the cardholder may dispute any charges that he or she thinks are incorrect (see Fair Credit Billing Act for details of the US regulations). Otherwise, the cardholder must pay a defined minimum proportion of the bill by a due date, or may choose to pay a higher amount up to the entire amount owed. The credit provider charges interest on the amount owed (typically at a much higher rate than most other forms of debt). Some financial institutions can arrange for automatic payments to be deducted from the user's bank accounts, thus avoiding late payment altogether as long as the cardholder has sufficient funds.[edit] Interest chargesCredit card issuers usually waive interest charges if the balance is paid in full each month, but typically will charge full interest on the entire outstanding balance from the date of each purchase if the total balance is not paid.For example, if a user had a $1,000 transaction and repaid it in full within this grace period, there would be no interest charged. If, however, even $1.00 of the total amount remained unpaid, interest would be charged on the $1,000 from the date of purchase until the payment is received. The precise manner in which interest is charged is usually detailed in a cardholder agreement which may be summarized on the back of the monthly statement. The general calculation formula most financial institutions use to determine the amount of interest to be charged is APR/100 x ADB/365 x number of days revolved. Take the Annual percentage rate (APR) and divide by 100 then multiply to the amount of the average daily balance (ADB) divided by 365 and then take this total and multiply by the total number of days the amount revolved before payment was made on the account. Financial institutions refer to interest charged back to the original time of the transaction and up to the time a payment was made, if not in full, as RRFC or residual retail finance charge. Thus after an amount has revolved and a payment has been made, the user of the card will still receive interest charges on their statement after paying the next statement in full (in fact the statement may only have a charge for interest that collected up until the date the full balance was paid...i.e. when the balance stopped revolving).[1]The credit card may simply serve as a form of revolving credit, or it may become a complicated financial instrument with multiple balance segments each at a different interest rate, possibly with a single umbrella credit limit, or with separate credit limits applicable to the various balance segments. Usually this compartmentalization is the result of special incentive offers from the issuing bank, to encourage balance transfers from cards of other issuers. In the event that several interest rates apply to various balance segments, payment allocation is generally at the discretion of the issuing bank, and payments will therefore usually be allocated towards the lowest rate balances until paid in full before any money is paid towards higher rate balances. Interest rates can vary considerably from card to card, and the interest rate on a particular card may jump dramatically if the card user is late with a payment on that card or any other credit instrument, or even if the issuing bank decides to raise its revenue.[edit] BenefitsBecause of intense competition in the credit card industry, credit card providers often offer incentives such as frequent flyer points, gift certificates, or cash back (typically up to 1 percent based on total purchases) to try to attract customers to their programs.Low interest credit cards or even 0% interest credit cards are available. The only downside to consumers is that the period of low interest credit cards is limited to a fixed term, usually between 6 and 12 months after which a higher rate is charged. However, services are available which alert credit card holders when their low interest period is due to expire. Most such services charge a monthly or annual fee.[edit] Grace periodA credit card's grace period is the time the customer has to pay the balance before interest is charged to the balance. Grace periods vary, but usually range from 20 to 30 days depending on the type of credit card and the issuing bank. Some policies allow for reinstatement after certain conditions are met.Usually, if a customer is late paying the balance, finance charges will be calculated and the grace period does not apply. Finance charges incurred depend on the grace period and balance; with most credit cards there is no grace period if there is any outstanding balance from the previous billing cycle or statement (i.e. interest is applied on both the previous balance and new transactions). However, there are some credit cards that will only apply finance charge on the previous or old balance, excluding new transactions.[edit] The merchant's sideAn example of street markets accepting credit cardsFor merchants, a credit card transaction is often more secure than other forms of payment, such as checks, because the issuing bank commits to pay the merchant the moment the transaction is authorized, regardless of whether the consumer defaults on the credit card payment (except for legitimate disputes, which are discussed below, and can result in charges back to the merchant). In most cases, cards are even more secure than cash, because they discourage theft by the merchant's employees and reduce the amount of cash on the premises.For each purchase, the bank charges the merchant a commission (discount fee) for this service and there may be a certain delay before the agreed payment is received by the merchant. The commission is often a percentage of the transaction amount, plus a fixed fee. In addition, a merchant may be penalized or have their ability to receive payment using that credit card restricted if there are too many cancellations or reversals of charges as a result of disputes. Some small merchants require credit purchases to have a minimum amount (usually between $5 and $10) to compensate for the transaction costs, though this is not always allowed by the credit card consortium.In some countries, for example the Nordic countries, banks guarantee payment on stolen cards only if an ID card is checked and the ID card number/civic registration number is written down on the receipt together with the signature. In these countries merchants therefore usually ask for ID. Non-Nordic citizens, who are unlikely to possess a Nordic ID card or driving license, will instead have to show their passport, and the passport number will be written down on the receipt, sometimes together with other information. Some shops use the card's PIN for identification, and in that case showing an ID card is not necessary.[edit] Parties involvedCardholder: The holder of the card used to make a purchase; the consumer.Card-issuing bank: The financial institution or other organization that issued the credit card to the cardholder. This bank bills the consumer for repayment and bears the risk that the card is used fraudulently. American Express and Discover were previously the only card-issuing banks for their respective brands, but as of 2007, this is no longer the case.Merchant: The individual or business accepting credit card payments for products or services sold to the cardholderAcquiring bank: The financial institution accepting payment for the products or services on behalf of the merchant.Independent sales organization: Resellers (to merchants) of the services of the acquiring bank.Merchant account: This could refer to the acquiring bank or the independent sales organization, but in general is the organization that the merchant deals with.Credit Card association: An association of card-issuing banks such as Visa, MasterCard, Discover, American Express, etc. that set transaction terms for merchants, card-issuing banks, and acquiring banks.Transaction network: The system that implements the mechanics of the electronic transactions. May be operated by an independent company, and one company may operate multiple networks. Transaction processing networks include: Cardnet, Nabanco, Omaha, Paymentech, NDC Atlanta, Nova, Vital, Concord EFSnet, and VisaNet.[2]Affinity partner: Some institutions lend their names to an issuer to attract customers that have a strong relationship with that institution, and get paid a fee or a percentage of the balance for each card issued using their name. Examples of typical affinity partners are sports teams, universities and charities.The flow of information and money between these parties — always through the card associations — is known as the interchange, and it consists of a few steps.[edit] Transaction stepsAuthorization: The cardholder pays for the purchase and the merchant submits the transaction to the acquirer (acquiring bank). The acquirer verifies the credit card number, the transaction type and the amount with the issuer (Card-issuing bank) and reserves that amount of the cardholder's credit limit for the merchant. An authorization will generate an approval code, which the merchant stores with the transaction.Batching: Authorized transactions are stored in "batches", which are sent to the acquirer. Batches are typically submitted once per day at the end of the business day. If a transaction is not submitted in the batch, the authorization will stay valid for a period determined by the issuer, after which the held amount will be returned back to the cardholder's available credit (see authorization hold). Some transactions may be submitted in the batch without prior authorizations; these are either transactions falling under the merchant's floor limit or ones where the authorization was unsuccessful but the merchant still attempts to force the transaction through. (Such may be the case when the cardholder is not present but owes the merchant additional money, such as extending a hotel stay or car rental.)Clearing and Settlement: The acquirer sends the batch transactions through the credit card association, which debits the issuers for payment and credits the acquirer. Essentially, the issuer pays the acquirer for the transaction.Funding: Once the acquirer has been paid, the acquirer pays the merchant. The merchant receives the amount totaling the funds in the batch minus the "discount rate," which is the fee the merchant pays the acquirer for processing the transactions.Chargebacks: A chargeback is an event in which money in a merchant account is held due to a dispute relating to the transaction. Chargebacks are typically initiated by the cardholder. In the event of a chargeback, the issuer returns the transaction to the acquirer for resolution. The acquirer then forwards the chargeback to the merchant, who must either accept the chargeback or contest it.[edit] Secured credit cardsA secured credit card is a type of credit card secured by a deposit account owned by the cardholder. Typically, the cardholder must deposit between 100% and 200% of the total amount of credit desired. Thus if the cardholder puts down $1000, they will be given credit in the range of $500–$1000. In some cases, credit card issuers will offer incentives even on their secured card portfolios. In these cases, the deposit required may be significantly less than the required credit limit, and can be as low as 10% of the desired credit limit. This deposit is held in a special savings account. Credit card issuers offer this because they have noticed that delinquencies were notably reduced when the customer perceives something to lose if the balance is not repaid.The cardholder of a secured credit card is still expected to make regular payments, as with a regular credit card, but should they default on a payment, the card issuer has the option of recovering the cost of the purchases paid to the merchants out of the deposit. The advantage of the secured card for an individual with negative or no credit history is that most companies report regularly to the major credit bureaus. This allows for building of positive credit history.Although the deposit is in the hands of the credit card issuer as security in the event of default by the consumer, the deposit will not be debited simply for missing one or two payments. Usually the deposit is only used as an offset when the account is closed, either at the request of the customer or due to severe delinquency (150 to 180 days). This means that an account which is less than 150 days delinquent will continue to accrue interest and fees, and could result in a balance which is much higher than the actual credit limit on the card. In these cases the total debt may far exceed the original deposit and the cardholder not only forfeits their deposit but is left with an additional debt.Most of these conditions are usually described in a cardholder agreement which the cardholder signs when their account is opened.Secured credit cards are an option to allow a person with a poor credit history or no credit history to have a credit card which might not otherwise be available. They are often offered as a means of rebuilding one's credit. Secured credit cards are available with both Visa and MasterCard logos on them. Fees and service charges for secured credit cards often exceed those charged for ordinary non-secured credit cards, however, for people in certain situations, (for example, after charging off on other credit cards, or people with a long history of delinquency on various forms of debt), secured cards can often be less expensive in total cost than unsecured credit cards, even including the security deposit.Sometimes a credit card will be secured by the equity in the borrower's home.[3][4] This is called a home equity line of credit (HELOC).[edit] Prepaid "credit" cardsSee also: Stored-value cardA prepaid credit card is not a credit card,[5] since no credit is offered by the card issuer: the card-holder spends money which has been "stored" via a prior deposit by the card-holder or someone else, such as a parent or employer. However, it carries a credit-card brand (Visa, MasterCard, American Express or Discover) and can be used in similar ways just as though it were a regular credit card.[5][6]After purchasing the card, the cardholder loads it with any amount of money, up to the predetermined card limit [7] and then uses the card to make purchases the same way as a typical credit card. Prepaid cards can be issued to minors (above 13) since there is no credit line involved. The main advantage over secured credit cards (see above section) is that you are not required to come up with $500 or more to open an account. [8] With prepaid credit cards you are not charged any interest but you are often charged a purchasing fee plus monthly fees after an arbitrary time period. Many other fees also usually apply to a prepaid card.[5]Prepaid credit cards are sometimes marketed to teenagers[5] for shopping online without having their parents complete the transaction.[9][10][11][12]Because of the many fees that apply to obtaining and using credit-card-branded prepaid cards, the Financial Consumer Agency of Canada describes them as "an expensive way to spend your own money".[13] The agency publishes a booklet, "Pre-paid cards",[14] which explains the advantages and disadvantages of this type of prepaid card.[edit] FeaturesAs well as convenient, accessible credit, credit cards offer consumers an easy way to track expenses, which is necessary for both monitoring personal expenditures and the tracking of work-related expenses for taxation and reimbursement purposes. Credit cards are accepted worldwide, and are available with a large variety of credit limits, repayment arrangement, and other perks (such as rewards schemes in which points earned by purchasing goods with the card can be redeemed for further goods and services or credit card cashback).Some countries, such as the United States, the United Kingdom, and France, limit the amount for which a consumer can be held liable due to fraudulent transactions as a result of a consumer's credit card being lost or stolen.[edit] SecurityCredit card security relies on the physical security of the plastic card as well as the privacy of the credit card number. Therefore, whenever a person other than the card owner has access to the card or its number, security is potentially compromised. Merchants often accept credit card numbers without additional verification for mail order purchases. They however record the delivery address as a security measure to minimise fraudulent purchases. Some merchants will accept a credit card number for in-store purchases, whereupon access to the number allows easy fraud, but many require the card itself to be present, and require a signature. Thus, a stolen card can be cancelled, and if this is done quickly, no fraud can take place in this way. For internet purchases, there is sometimes the same level of security as for mail order (number only) hence requiring only that the fraudster take care about collecting the goods, but often there are additional measures. The main one is to require a security PIN with the card, which requires that the thief have access to the card, as well as the PIN.An additional feature to secure the credit card transaction and prohibit the use of a lost credit card is the MobiClear solution. Each transaction is authenticated through a call to the user mobile phone. The transaction is released once the transaction has been confirmed by the cardholder pushing his/her pincode during the call.The PCI DSS is the security standard issued by The PCI SSC (Payment Card Industry Security Standards Council). This data security standard is used by acquiring banks to impose cardholder data security measures upon their merchants.[edit] ProblemsMain article: Credit card fraudA smart card, combining credit card and debit card properties. The 3 by 5 mm security chip embedded in the card is shown enlarged in the inset. The contact pads on the card enable electronic access to the chip.The low security of the credit card system presents countless opportunities for fraud. This opportunity has created a huge black market in stolen credit card numbers, which are generally used quickly before the cards are reported stolen.The goal of the credit card companies is not to eliminate fraud, but to "reduce it to manageable levels".[15] This implies that high-cost low-return fraud prevention measures will not be used if their cost exceeds the potential gains from fraud reduction.Most internet fraud is done through the use of stolen credit card information which is obtained in many ways, the simplest being copying information from retailers, either online or offline. Despite efforts to improve security for remote purchases using credit cards, systems with security holes are usually the result of poor implementations of card acquisition by merchants. For example, a website that uses SSL to encrypt card numbers from a client may simply email the number from the webserver to someone who manually processes the card details at a card terminal. Naturally, anywhere card details become human-readable before being processed at the acquiring bank, a security risk is created. However, many banks offer systems where encrypted card details captured on a merchant's webserver can be sent directly to the payment processor.Controlled Payment Numbers are another option for protecting one's credit card number: they are "alias" numbers linked to one's actual card number, generated as needed, valid for a relatively short time, with a very low limit, and typically only valid with a single merchant.The Federal Bureau of Investigation and U.S. Postal Inspection Service are responsible for prosecuting criminals who engage in credit card fraud in the United States, but they do not have the resources to pursue all criminals. In general, federal officials only prosecute cases exceeding US $5000 in value. Three improvements to card security have been introduced to the more common credit card networks but none has proven to help reduce credit card fraud so far. First, the on-line verification system used by merchants is being enhanced to require a 4 digit Personal Identification Number (PIN) known only to the card holder. Second, the cards themselves are being replaced with similar-looking tamper-resistant smart cards which are intended to make forgery more difficult. The majority of smartcard (IC card) based credit cards comply with the EMV (Europay MasterCard Visa) standard. Third, an additional 3 or 4 digit code is now present on the back of most cards, for use in "card not present" transactions. See CVV2 for more information.The way credit card owners pay off their balances has a tremendous effect on their credit history. All the information is collected by credit bureaus. The credit information stays on the credit report, depending on the jurisdiction and the situation, for 1, 2, 5, 7 or even 10 years after the debt is repaid.[edit] Profits and lossesIn recent times, credit card portfolios have been very profitable for banks, largely due to the booming economy of the late nineties. However, in the case of credit cards, such high returns go hand in hand with risk, since the business is essentially one of making unsecured (uncollateralized) loans, and thus dependent on borrowers not to default in large numbers.[edit] CostsCredit card issuers (banks) have several types of costs:[edit] Interest expensesBanks generally borrow the money they then lend to their customers. As they receive very low-interest loans from other firms, they may borrow as much as their customers require, while lending their capital to other borrowers at higher rates. If the card issuer charges 15% on money lent to users, and it costs 5% to borrow the money to lend, and the balance sits with the cardholder for a year, the issuer earns 10% on the loan. This 5% difference is the "interest expense" and the 10% is the "net interest spread".[edit] Operating costsThis is the cost of running the credit card portfolio, including everything from paying the executives who run the company to printing the plastics, to mailing the statements, to running the computers that keep track of every cardholder's balance, to taking the many phone calls which cardholders place to their issuer, to protecting the customers from fraud rings. Depending on the issuer, marketing programs are also a significant portion of expenses.[edit] Charge offsWhen a consumer becomes severely delinquent on a debt (often at the point of six months without payment), the creditor may declare the debt to be a charge-off. It will then be listed as such on the debtor's credit bureau reports (Equifax, for instance, lists "R9" in the "status" column to denote a charge-off.) The item will include relevant dates, and the amount of the bad debt.[16]A charge-off is considered to be "written off as uncollectable." To banks, bad debts and even fraud are simply part of the cost of doing business.However, the debt is still legally valid, and the creditor can attempt to collect the full amount for the time periods permitted under state law, which is usually 3 to 7 years. This includes contacts from internal collections staff, or more likely, an outside collection agency. If the amount is large (generally over $1500 - $2000), there is the possibility of a lawsuit or arbitration.In the US, as the charge off number climbs or becomes erratic, officials from the Federal Reserve take a close look at the finances of the bank and may impose various operating strictures on the bank, and in the most extreme cases, may close the bank entirely.[edit] RewardsQantas Frequent Flyer co-branded credit cardsMany credit card customers receive rewards, such as frequent flier points, gift certificates, or cash back as an incentive to use the card. Rewards are generally tied to purchasing an item or service on the card, which may or may not include balance transfers, cash advances, or other special uses. Depending on the type of card, rewards will generally cost the issuer between 0.25% and 2.0% of the spend. Networks such as Visa or MasterCard have increased their fees to allow issuers to fund their rewards system. However, most rewards points are accrued as a liability on a company's balance sheet and expensed at the time of reward redemption. As a result, some issuers discourage redemption by forcing the cardholder to call customer service for rewards. On their servicing website, redeeming awards is usually a feature that is very well hidden by the issuers. Others encourage redemption for lower cost merchandise; instead of an airline ticket, which is very expensive to an issuer, the cardholder may be encouraged to redeem for a gift certificate instead. With a fractured and competitive environment, rewards points cut dramatically into an issuer's bottom line, and rewards points and related incentives must be carefully managed to ensure a profitable portfolio. There is a case to be made that rewards not redeemed should follow the same path as gift cards that are not used: in certain states the gift card breakage goes to the state's treasury. The same could happen to the value of points or cash not redeemed.[edit] FraudThe cost of fraud is high; in the UK in 2004 it was over £500 million.[17] When a card is stolen, or an unauthorized duplicate made, most card issuers will refund some or all of the charges that the customer has received for things they did not buy. These refunds will, in some cases, be at the expense of the merchant, especially in mail order cases where the merchant cannot claim sight of the card. In several countries, merchants will lose the money if no ID card was asked for, therefore merchants usually require ID card in these countries. Credit card companies generally guarantee the merchant will be paid on legitimate transactions regardless of whether the consumer pays their credit card bill.[edit] RevenuesOffsetting costs are the following revenues:[edit] Interchange feeMain article: Interchange feeBank card associations such as Visa and MasterCard require merchants to pay billions of dollars in Interchange fees to banks that issue their credit and debit cards.[18] Card-issuing banks obtain these interchange fees in addition to the enormous revenue they receive from card holder interest and fees. Interchange fees are the single largest component of the various fees that banks deduct from merchants' credit card sales. Merchants pay their banks fees of 1 to 6 percent of each sale (for large merchants these fees may be negotiated[19], but will vary not only from merchant to merchant, but also from card to card, with business cards and rewards cards generally costing the merchants more to process), which is why many merchants prefer cash, PIN-based debit cards, or even cheques, or will add a percentage to the sale price to cover the interchange fee. Traditionally, interchange fees have been set by the bank card associations and their major card-issuing banks, who are the primary beneficiaries of these fees.[20]The interchange fee that applies to a particular merchant is a function of many variables including the type of merchant, the merchant's total card sales volume, the merchant's average transaction amount, whether the cards are physically present, if the card's magnetic stripe is read or if the transaction is hand-keyed or entered on a website, the specific type of card, when the transaction is settled, the authorized and settled transaction amounts, etc. For a typical credit card issuer, interchange fee revenues may represent about a quarter of total revenues,[19] but this will vary greatly among credit card issuers. Interchange fees may consume over 50 percent of profits from card sales for some merchants (such as supermarkets) that operate on slim margins. Merchants contend that interchange fees force them to raise prices for everyone; banks contend that interchange fees enable them to offer better cardholder rewards for their best customers.[edit] Interest on outstanding balancesInterest charges vary widely from card issuer to card issuer. Often, there are "teaser" rates in effect for initial periods of time (as low as zero percent for, say, six months), whereas regular rates can be as high as 40 percent. In the U.S. there is no federal limit on the interest or late fees credit card issuers can charge; the interest rates are set by the states, with some states such as South Dakota, having no ceiling on interest rates and fees, inviting some banks to establish their credit card operations there. Other states, for example Delaware, have very weak usury laws. The teaser rate no longer applies if the customer doesn't pay his bills on time, and is replaced by a penalty interest rate (for example, 24.99%) that applies retroactively. So customers should be wary of these offers, that usually contain some traps.[edit] Fees charged to customersThe major fees are for:Late payments or overdue paymentsCharges that result in exceeding the credit limit on the card (whether done deliberately or by mistake), called overlimit feesReturned cheque fees or payment processing fees (eg phone payment fee)Cash advances and convenience cheques (often 3% of the amount)[21]. Transactions in a foreign currency (as much as 3% of the amount). A few financial institutions do not charge a fee for this.Membership fees (annual or monthly), sometimes a percentage of the credit limit.Exchange Rate Loading Fees (May not even appear on your statement!)[22][edit] Neutral consumer resources[edit] CanadaThe Government of Canada maintains a database of the fees, features, interest rates and reward programs of nearly 200 credit cards available in Canada. This database is updated on a quarterly basis with information supplied by the credit card issuing companies. Information in the database is published every quarter on the website of the Financial Consumer Agency of Canada (FCAC).Information in the database is published in two formats. It is available in PDF comparison tables that break down the information according to type of credit card, allowing the reader to compare the features of, for example, all the student credit cards in the database.The database also feeds into an interactive tool on the FCAC website.[23] The interactive tool uses several interview-type questions to build a profile of the user's credit card usage habits and needs, eliminating unsuitable choices based on the profile, so that the user is presented with a small number of credit cards and the ability to carry out detailed comparisons of features, reward programs, interest rates, etc.[edit] HistoryThe concept of using a card for purchases was described in 1887 by Edward Bellamy in his utopian novel Looking Backward. Bellamy used the term credit card eleven times in this novel.[24]The modern credit card was the successor of a variety of merchant credit schemes. It was first used in the 1920s, in the United States, specifically to sell fuel to a growing number of automobile owners. In 1938 several companies started to accept each other's cards.The concept of paying merchants using a card was invented in 1950 by Ralph Schneider and Frank X. McNamara in order to consolidate multiple cards. The Diners Club, which was created partially through a merger with Dine and Sign, produced the first "general purpose" charge card, which is similar but required the entire bill to be paid with each statement; it was followed shortly thereafter by American Express and Carte Blanche. Western Union had begun issuing charge cards to its frequent customers in 1914.Bank of America created the BankAmericard in 1958, a product which eventually evolved into the Visa system ("Chargex" also became Visa). MasterCard came to being in 1966 when a group of credit-issuing banks established MasterCharge. The fractured nature of the US banking system meant that credit cards became an effective way for those who were travelling around the country to move their credit to places where they could not directly use their banking facilities. In 1966 Barclaycard in the UK launched the first credit card outside of the US.There are now countless variations on the basic concept of revolving credit for individuals (as issued by banks and honored by a network of financial institutions), including organization-branded credit cards, corporate-user credit cards, store cards and so on.In contrast, although having reached very high adoption levels in the US, Canada and the UK, it is important to note that many cultures were much more cash-oriented in the latter half of the twentieth century, or had developed alternative forms of cash-less payments, such as Carte bleue or the EC-card (Germany, France, Switzerland, among many others). In these places, the take-up of credit cards was initially much slower. It took until the 1990s to reach anything like the percentage market-penetration levels achieved in the US, Canada or UK. In many countries acceptance still remains poor as the use of a credit card system depends on the banking system being perceived as reliable.In contrast, because of the legislative framework surrounding banking system overdrafts, some countries, France in particular, were much faster to develop and adopt chip-based credit cards which are now seen as major anti-fraud credit devices.The design of the credit card itself has become a major selling point in recent years. The value of the card to the issuer is often related to the customer's usage of the card, or to the customer's financial worth. This has led to the rise of Co-Brand and Affinity cards - where the card design is related to the "affinity" (a university, for example) leading to higher card usage. In most cases a percentage of the value of the card is returned to the affinity group.[edit] Charga-PlateThe Charga-Plate was an early predecessor to the credit card. It was a 2 1/2" x 1 1/4" rectangle of sheet metal, similar to a military dog tag, that was embossed with the customer's name, city and state (no address). It held a small paper card for a signature. It was laid in the imprinter first, then a charge slip on top of it, onto which an inked ribbon was pressed.[25] Charga-Plate was a trademark of Farrington Manufacturing Co. Charga-Plates were issued by large-scale merchants, much like department store credit cards of today. In some cases, the plates were kept in the issuing store rather than held by customers. When an authorized user made a purchase, a clerk retrieved the plate from the store's files and then processed the purchase. Charga-Plates speeded back-office bookkeeping that was done manually in paper ledgers in each store, before computers.[edit] Collectible credit cardsA growing field of numismatics (study of money), or more specifically exonumia (study of money-like objects), credit card collectors seek to collect various embodiments of credit from the now familiar plastic cards to older paper merchant cards, and even metal tokens that were accepted as merchant credit cards. Early credit cards were made of celluloid, then metal and fiber, then paper and are now mostly plastic.[edit] ControversyCredit card debt has soared, particularly among young people. Since the late 1990s, lawmakers, consumer advocacy groups, college officials and other higher education affiliates have become increasingly concerned about the rising use of credit cards among college students. The major credit card companies have been accused of targeting a younger audience, in particular college students, many of whom are already in debt with college tuition fees and college loans and who typically are less experienced at managing their own finances.A 2006 documentary film titled Maxed Out: Hard Times, Easy Credit and the Era of Predatory Lenders deals with this subject in detail.[26] The nonprofit group Americans for Fairness in Lending works with Maxed Out to educate Americans about credit card abuse.Another controversial area is the universal default feature of many North American credit card contracts. When a cardholder is late paying a particular credit card issuer, that card's interest rate can be raised, often considerably. Universal default allows creditors to periodically check cardholders' credit portfolios to view trade, thus allowing the institution to decrease the credit limit or increase rates on cardholders who may be late with another credit card issuer. Being late on one credit card will potentially affect all the cardholder's credit cards. Citibank voluntarily stopped this practice in March 2007 and Chase stopped the practice in November 2007.[27]Another controversial area is the trailing interest issue. Trailing interest is the practice of charging interest on the entire bill no matter what percentage of it is paid. U.S Senator Carl Levin raised the issue at a U.S Senate Hearing of millions of Americans whom he said are slaves to hidden fees, compounding interest and cryptic terms. Their woes were heard in a Senate Permanent Subcommittee on Investigations hearing which was chaired by Senator Levin who said that he intends to keep the spotlight on credit card companies and that legislative action may be necessary to purge the industry.[28]In the United States, some have called for Congress to enact additional regulations on the industry; to expand the disclosure box clearly disclosing rate hikes, use plain language, incorporate balance payoff disclosures, and also to outlaw universal default. At a congress hearing around March 1, 2007, Citibank announced it would no longer practice this, effective immediately. Opponents of such regulation argue that customers must become more proactive and self-responsible in evaluating and negotiating terms with credit offerers. Some of the nation's influential top credit card issuers, who are among the top fifty corporate contributors to political campaigns, successfully opposed it.[edit] Hidden costsIn the United Kingdom, merchants won the right through The Credit Cards (Price Discrimination) Order 1990[29] to charge customers different prices according to the payment method. The United Kingdom is the world's most credit-card-intensive country, with 67 million credit cards for a population of 59 million people.[30]In the United States, until 1984 federal law prohibited surcharges on card transactions. Although the federal Truth in Lending Act provisions that prohibited surcharges expired that year, a number of states have since enacted laws that continue to outlaw the practice; California, Colorado, Connecticut, Florida, Kansas, Massachusetts, Maine, New York, Oklahoma, and Texas have laws against surcharges.[edit] RedliningCredit Card redlining is a spatially discriminatory practice among credit card issuers of providing different amounts of credit to different areas, based on their ethnic-minority composition, rather than on economic criteria, such as the potential profitability of operating in those areas.[31][edit] Credit card numberingMain article: Credit card numberThe numbers found on credit cards have a certain amount of internal structure, and share a common numbering scheme.The card number's prefix, called the Bank Identification Number, is the sequence of digits at the beginning of the number that determine the bank to which a credit card number belongs. This is the first six digits for MasterCard and Visa cards. The next nine digits are the individual account number, and the final digit is a validity check code.In addition to the main credit card number, credit cards also carry issue and expiration dates (given to the nearest month), as well as extra codes such as issue numbers and security codes. Not all credit cards have the same sets of extra codes nor do they use the same number of digits.[edit] Credit cards in ATMsMany credit cards can also be used in an ATM to withdraw money against the credit limit extended to the card, but many card issuers charge interest on cash advances before they do so on purchases. The interest on cash advances is commonly charged from the date the withdrawal is made, rather than the monthly billing date. Many card issuers levy a commission for cash withdrawals, even if the ATM belongs to the same bank as the card issuer. Merchants do not offer cashback on credit card transactions because they would pay a percentage commission of the additional cash amount to their bank or merchant services provider, thereby making it uneconomical.Many credit card companies will also, when applying payments to a card, do so at the end of a billing cycle, and apply those payments to everything before cash advances. For this reason, many consumers have large cash balances, which have no grace period and incur interest at a rate that is (usually) higher than the purchase rate, and will carry those balance for years, even if they pay off their statement balance each month.[edit] Credit cards as funding for entrepreneursCredit cards are a creative, yet often risky way for entrepreneurs to acquire capital for their start ups when more conventional financing is unavailable. It is rumoured that Larry Page and Sergey Brin's start up of Google was financed by credit cards to buy the necessary computers and office equipment, more specifically "a terabyte of hard disks".[32] Similarly, filmmaker Robert Townsend financed part of Hollywood Shuffle using credit cards.[33] Director Kevin Smith funded Clerks in part by maxing out several credit cards. Richard Hatch also financed his production of Battlestar Galactica: The Second Coming partly through his credit cards. Famed hedge fund manager Bruce Kovner began his career (and, later on, his firm Caxton Associates) in financial markets by borrowing from his credit card.

Airline

Airline
The First AirlinesFailed attempt at an airline before DELAGDELAG, Deutsche Luftschiffahrts-Aktiengesellschaft (German: acronym for "German Airship Transport Corporation") was the world's first airline. It was founded on November 16, 1909 with government assistance, and operated airships manufactured by Zeppelin Corporation. Its headquarters were in Frankfurt. (Note: Americans, such as Rufus Porter and Frederick Marriott, attempted to start airlines in the mid-19th century, focusing on the New York-California route. Those attempts foundered due to such mishaps as the aircraft catching fire and the aircraft being ripped apart by spectators.) The five oldest non-dirigible airlines that still exist are Australia's Qantas, Netherland's KLM, Colombia's Avianca, Czech Republic's Czech Airlines and Mexico's Mexicana. KLM first flew in May 1920 while Qantas (for the Queensland and Northern Territory Aerial Services Limited) was founded in Queensland, Australia in late 1920. Qantas has operated ever since with a perfect safety record with no loss of lives [1].[edit] U.S. Airline Industry[edit] Early DevelopmentTony Jannus conducted the United States' first scheduled commercial airline flight on 1 January 1914 for the Saint Petersburg-routes, Braniff Airways, American Airlines, Delta Air Lines, United Airlines (originally a division of Boeing), Trans World Airlines, Northwest Airlines, and Eastern Air Lines, to name a few.US airline route structure before World War IIPassenger service during the early 1920s was sporadic: most airlines at the time were focused on carrying bags of mail. In 1925, however, the Ford Motor Company bought out the Stout Aircraft Company and began construction of the all-metal Ford Trimotor, which became the first successful American airliner. With a 12-passenger capacity, the Trimotor made passenger service potentially profitable. Air service was seen as a supplement to rail service in the American transportation network.At the same time, Juan Trippe began a crusade to create an air network that would link America to the world, and he achieved this goal through his airline, Pan American World Airways, with a fleet of flying boats that linked Los Angeles to Shanghai and Boston to London. Pan Am and Northwest Airways (which began flights to Canada in the 1920s) were the only U.S. airlines to go international before the 1940s.With the introduction of the Boeing 247 and Douglas DC-3 in the 1930s, the U.S. airline industry was generally profitable, even during the Great Depression. This trend continued until the beginning of World War II.[edit] Development since 1945Post-war airline route structure.[citation needed]As governments met to set the standards and scope for an emergent civil air industry toward the end of the war, it was no surprise that the U.S. took a position of maximum operating freedom. After all, U.S. airline companies were not devastated by the war, as European companies and the few Asian companies had been. This preference for "open skies" operating regimes continues, within limitations, to this day.World War II, like World War I, brought new life to the airline industry. Many airlines in the Allied countries were flush from lease contracts to the military, and foresaw a future explosive demand for civil air transport, for both passengers and cargo. They were eager to invest in the newly emerging flagships of air travel such as the Boeing Stratocruiser, Lockheed Constellation, and Douglas DC-6. Most of these new aircraft were based on American bombers such as the B-29, which had spearheaded research into new technologies such as pressurization. Most offered increased efficiency from both added speed and greater payload.In the 1950s, the De Havilland Comet, Boeing 707, Douglas DC-8, and Sud Aviation Caravelle became the first flagships of the Jet Age in the West, while the Soviet Union bloc countered with the Tupolev Tu-104 and Tupolev Tu-124 in the fleets of state-owned carriers such as Aeroflot and Interflug. The Vickers Viscount and Lockheed L-188 Electra inaugurated turboprop transport.Airline trunk route systems.[citation needed]The next big boost for the airlines would come in the 1970s, when the Boeing 747, McDonnell Douglas DC-10, and Lockheed L-1011 inaugurated widebody ("jumbo jet") service, which is still the standard in international travel. The Tupolev Tu-144 and its Western counterpart, Concorde, made supersonic travel a reality. Concorde first flew in 1969 and operated through 2003. In 1972, Airbus began producing Europe's most commercially successful line of airliners to date. The added efficiencies for these aircraft were often not in speed, but in passenger capacity, payload, and range. Airbus also features modern electronic cockpits that were common across their aircraft to enable pilots to fly multiple aircraft with minimal cross-training.1978's U.S. airline industry deregulation lowered barriers for new airlines. In this period, new start-ups entered during downturns in the normal 8-10 year business cycle. At that time, they find aircraft, are financed, contract hangar and maintenance services, train new employees, and recruit laid off staff from other airlines.As the business cycle returned to normalcy, major airlines dominated their routes through aggressive pricing and additional capacity offerings, often swamping new startups. Only America West Airlines (which has since merged with US Airways) remained a significant survivor from this new entrant era, as dozens, even hundreds, have gone under.In many ways, the biggest winner in the deregulated environment was the air passenger. Indeed, the U.S. witnessed an explosive growth in demand for air travel, as many millions who had never or rarely flown before became regular fliers, even joining frequent flyer loyalty programs and receiving free flights and other benefits from their flying. New services and higher frequencies meant that business fliers could fly to another city, do business, and return the same day, for almost any point in the country. Air travel's advantages put intercity bus lines under pressure, and most have withered away.By the 1980s, almost half of the total flying in the world took place in the U.S., and today the domestic industry operates over 10,000 daily departures nationwide.De-regulated hub and spoke airline route structures.[citation needed]Toward the end of the century, a new style of low cost airline emerged, offering a no-frills product at a lower price. Southwest Airlines, JetBlue, AirTran Airways, Skybus Airlines and other low-cost carriers began to represent a serious challenge to the so-called "legacy airlines", as did their low-cost counterparts in Europe, Canada, and Asia. Their commercial viability represented a serious competitive threat to the legacy carriers. However, of these, ATA and Skybus have since ceased operations.Thus the last 50 years of the airline industry have varied from reasonably profitable, to devastatingly depressed. As the first major market to deregulate the industry in 1978, U.S. airlines have experienced more turbulence than almost any other country or region. Today, almost every single legacy carrier except for American Airlines has operated under Chapter 11 bankruptcy provisions or have gone out of business.[edit] European Airline IndustryThe Imperial Airways Empire Terminal, Victoria, London. Trains ran from here to flying boats in Southampton, and to Croydon Airport.The first countries in Europe to embrace air transport were Finland, France, Germany, the Netherlands and the United Kingdom.KLM, the oldest carrier still operating under its original name, was founded in 1919. The first flight (operated on behalf of KLM by Aircraft Transport and Travel) transported two English passengers to Schiphol, Amsterdam from London in 1920. Like other major European airlines of the time (see France and the UK below), KLM's early growth depended heavily on the needs to service links with far-flung colonial possessions (Dutch Indies). It is only after the loss of the Dutch Empire that KLM found itself based at a small country with few potential passengers, depending heavily on transfer traffic, and was one of the first to introduce the hub-system to facilitate easy connections.France began an air mail service to Morocco in 1919 that was bought out in 1927, renamed Aéropostale, and injected with capital to become a major international carrier. In 1933, Aéropostale went bankrupt, was nationalized and merged with several other airlines into what became Air France.In Finland, the charter establishing Aero O/Y (now Finnair, one of the oldest still-operating airlines in the world) was signed in the city of Helsinki on 12 September 1923. Junkers F 13 D-335 became the first aircraft of the company, when Aero took delivery of it on 14 March 1924. The first flight was between Helsinki and Tallinn, capital of Estonia, and it took place on 20 March 1924, one week later.Germany's Lufthansa began in 1926. Lufthansa, unlike most other airlines at the time, became a major investor in airlines outside of Europe, providing capital to Varig and Avianca. German airliners built by Junkers, Dornier, and Fokker were the most advanced in the world at the time. The peak of German air travel came in the mid-1930s, when Nazi propaganda ministers approved the start of commercial zeppelin service: the big airships were a symbol of industrial might, but the fact that they used flammable hydrogen gas raised safety concerns that culminated with the Hindenburg disaster of 1937. The reason they used hydrogen instead of the not-flammable helium gas was a United States military embargo on helium.The British company Aircraft Transport and Travel commenced a London to Paris service on 25 August 1919, this was the world's first regular international flight. The United Kingdom's flag carrier during this period was Imperial Airways, which became BOAC (British Overseas Airways Co.) in 1939. Imperial Airways used huge Handley-Page biplanes for routes between London, the Middle East, and India: images of Imperial aircraft in the middle of the Rub'al Khali, being maintained by Bedouins, are among the most famous pictures from the heyday of the British Empire.[edit] DeregulationDeregulation of the European Union airspace in the early 1990s has had substantial effect on structure of the industry there. The shift towards 'budget' airlines on shorter routes has been significant. Airlines such as Easyjet and Ryanair have grown at the expense of the traditional national airlines.There has also been a trend for these national airlines themselves to be privatised such as has occurred for Aer Lingus (Ireland) and British Airways. Other national airlines, including Italy's Alitalia, have suffered - particularly with the rapid increase of oil prices in early 2008.[edit] Latin American Airline IndustryLAN jets at Santiago, Chile (SCL)Along the first countries to have regular airlines in Latin America were Chile with LAN Chile (today LAN Airlines), Colombia with Avianca, Mexico with Mexicana de Aviación, Brazil with Varig, and TACA as a bound of several airlines of Central American countries (Honduras, El Salvador, Costa Rica, Guatemala and Nicaragua). All the previous airlines started regular operations before World War II.Aeromexico is also in service since 1934, but was initially called Aeronaves de México. The same situation happened with other regional airlines, such as Aerolineas Argentinas. All of these airlines are still in service.The air travel market has evolved rapidly over recent years in Latin America. Some industry estimations over 2000 new aircraft will begin service over the next five years in this region.These airlines serve domestic flights within their countries, as well as connections within Latin America and also overseas flights to North America, Europe, Australia, Africa and Asia.Just one airline, LAN (Latin American Networks) has international subsidiaries: Chile as the central operation along with Peru, Ecuador, Argentina and some operations in the Dominican Republic.The main hubs in Latin America are Sao Paulo in Brazil, Bogota in Colombia,Caracas in Venezuela, Lima in Peru, Mexico City in Mexico, Buenos Aires in Argentina, and Santiago in Chile.[edit] Asian Airline IndustrySome of the first countries in Asia to embrace air transport were India, Hong Kong, Indonesia, Malaysia and the Philippines.One of the first countries in Asia to embrace air transport was the Philippines. Philippine Airlines was founded on February 26, 1941, making it Asia's oldest carrier and the oldest operating under its current name. The airline was started by a group of businessmen led by Andres Soriano, hailed as one of the Philippines' leading industrialists at the time. The airline’s first flight was made on March 15, 1941 with a single Beech Model 18 NPC-54 aircraft, which started its daily services between Manila (from Nielson Field) and Baguio, later to expand with larger aircraft such as the DC-3 and Vickers Viscount. Notably Philippine Airlines leased Japan Airlines their first aircraft, a DC-3 named "Kinsei". On July 31, 1946, a chartered Philippine Airlines DC-4 ferried 40 American servicemen to Oakland,California from Nielson Airport in Makati City with stops in Guam, Wake Island, Johnston Atoll and Honolulu, Hawaii, making PAL the first Asian airline to cross the Pacific Ocean. A regular service between Manila and San Francisco was started in December. It was during this year that the airline was designated as the Philippines flag carrier.Air India Boeing 747-400. The Government of India is the majority stake-holder in Air India and Indian Airlines.Another airline company to begin early operations was Air India, which had its beginning as Tata Airlines in 1932, a division of Tata Sons Ltd. (now Tata Group) by India's leading industrialist JRD Tata. On October 15, 1932, J. R. D. Tata himself flew a single engined De Havilland Puss Moth carrying air mail (postal mail of Imperial Airways) from Karachi to Bombay via Ahmedabad. The aircraft continued to Madras via Bellary piloted by Royal Air Force pilot Nevill Vincent.With the outbreak of World War Two, the airline presence in Asia came to a relative halt, with many new flag carriers donating their aircraft for military aid and other uses.Following the end of World War II, regular commercial service was restored in India and Tata Airlines became a public limited company on 29 July 1946 under the name Air India. After the Independence of India, 49% of the airline was acquired by the Government of India. In return, the airline was granted status to operate international services from India as the designated flag carrier under the name Air India International.Neighbouring countries also soon embraced air transport, notably with the beginning of a new nation, Pakistan began Orient Airways Ltd (Pakistan International Airlines), Cathay Pacific founded in 1946, Singapore Airlines and Malaysian Airlines in 1947 (as Malayan Airways), Garuda Indonesia in 1949, Japan Airlines in 1951, and Korean Air in 1962.[edit] Regulatory considerations[edit] NationalMany countries have national airlines that the government owns and operates. Fully private airlines are subject to a great deal of government regulation for economic, political, and safety concerns. For instance, the government often intervenes to halt airline labor actions in order to protect the free flow of people, communications, and goods between different regions without compromising safety.The United States, Australia, and to a lesser extent Brazil, Mexico, the United Kingdom and Japan have "deregulated" their airlines. In the past, these governments dictated airfares, route networks, and other operational requirements for each airline. Since deregulation, airlines have been largely free to negotiate their own operating arrangements with different airports, enter and exit routes easily, and to levy airfares and supply flights according to market demand.The entry barriers for new airlines are lower in a deregulated market, and so the U.S. has seen hundreds of airlines start up (sometimes for only a brief operating period). This has produced far greater competition than before deregulation in most markets, and average fares tend to drop 20% or more. The added competition, together with pricing freedom, means that new entrants often take market share with highly reduced rates that, to a limited degree, full service airlines must match. This is a major constraint on profitability for established carriers, which tend to have a higher cost base.As a result, profitability in a deregulated market is uneven for most airlines. These forces have caused some major airlines to go out of business, in addition to most of the poorly established new entrants.[edit] InternationalSingapore Airlines Boeing 747-412 taking off from London Heathrow Airport. The Boeing 747-412 has been the flagship of the SIA fleet since its first delivery on 18 March 1989.Groups such as the International Civil Aviation Organization establish worldwide standards for safety and other vital concerns. Most international air traffic is regulated by bilateral agreements between countries, which designate specific carriers to operate on specific routes. The model of such an agreement was the Bermuda Agreement between the US and UK following World War II, which designated airports to be used for transatlantic flights and gave each government the authority to nominate carriers to operate routes.Bilateral agreements are based on the "freedoms of the air," a group of generalized traffic rights ranging from the freedom to overfly a country to the freedom to provide domestic flights within a country (a very rarely granted right known as cabotage). Most agreements permit airlines to fly from their home country to designated airports in the other country: some also extend the freedom to provide continuing service to a third country, or to another destination in the other country while carrying passengers from overseas.In the 1990s, "open skies" agreements became more common. These agreements take many of these regulatory powers from state governments and open up international routes to further competition. Open skies agreements have met some criticism, particularly within the European Union, whose airlines would be at a comparative disadvantage with the United States' because of cabotage restrictions.[edit] Economic considerationsTAM Airlines Airbus A330-200Historically, air travel has survived largely through state support, whether in the form of equity or subsidies. The airline industry as a whole has made a cumulative loss during its 120-year history, once the costs include subsidies for aircraft development and airport construction.[1][2]One argument is that positive externalities, such as higher growth due to global mobility, outweigh the microeconomic losses and justify continuing government intervention. A historically high level of government intervention in the airline industry can be seen as part of a wider political consensus on strategic forms of transport, such as highways and railways, both of which receive public funding in most parts of the world. Profitability is likely to improve in the future as privatization continues and more competitive low-cost carriers proliferate.Although many countries continue to operate state-owned or parastatal airlines, many large airlines today are privately owned and are therefore governed by microeconomic principles in order to maximize shareholder profit.Lufthansa Boeing 747-400[edit] Ticket revenueAirlines assign prices to their services in an attempt to maximize profitability. The pricing of airline tickets has become increasingly complicated over the years and is now largely determined by computerized yield management systems.Because of the complications in scheduling flights and maintaining profitability, airlines have many loopholes that can be used by the knowledgeable traveler. Many of these airfare secrets are becoming more and more known to the general public, so airlines are forced to make constant adjustments.Most airlines use differentiated pricing, a form of price discrimination, in order to sell air services at varying prices simultaneously to different segments. Factors influencing the price include the days remaining until departure, the booked load factor, the forecast of total demand by price point, competitive pricing in force, and variations by day of week of departure and by time of day. Carriers often accomplish this by dividing each cabin of the aircraft (first, business and economy) into a number of travel classes for pricing purposes.A complicating factor is that of origin-destination control ("O&D control"). Someone purchasing a ticket from Melbourne to Sydney (as an example) for AU$200 is competing with someone else who wants to fly Melbourne to Los Angeles through Sydney on the same flight, and who is willing to pay AU$1400. Should the airline prefer the $1400 passenger, or the $200 passenger plus a possible Sydney-Los Angeles passenger willing to pay $1300? Airlines have to make hundreds of thousands of similar pricing decisions daily.The advent of advanced computerized reservations systems in the late 1970s, most notably Sabre, allowed airlines to easily perform cost-benefit analyses on different pricing structures, leading to almost perfect price discrimination in some cases (that is, filling each seat on an aircraft at the highest price that can be charged without driving the consumer elsewhere).The intense nature of airfare pricing has led to the term "fare war" to describe efforts by airlines to undercut other airlines on competitive routes. Through computers, new airfares can be published quickly and efficiently to the airlines' sales channels. For this purpose the airlines use the Airline Tariff Publishing Company (ATPCO), who distribute latest fares for more than 500 airlines to Computer Reservation Systems across the world.The extent of these pricing phenomena is strongest in "legacy" carriers. In contrast, low fare carriers usually offer preannounced and simplified price structure, and sometimes quote prices for each leg of a trip separately.Computers also allow airlines to predict, with some accuracy, how many passengers will actually fly after making a reservation to fly. This allows airlines to overbook their flights enough to fill the aircraft while accounting for "no-shows," but not enough (in most cases) to force paying passengers off the aircraft for lack of seats. Since an average of ⅓ of all seats are flown empty[citation needed], stimulative pricing for low demand flights coupled with overbooking on high demand flights can help reduce this figure.An Airbus A340-600 of Virgin Atlantic Airways[edit] Operating costsFull-service airlines have a high level of fixed and operating costs in order to establish and maintain air services: labor, fuel, airplanes, engines, spares and parts, IT services and networks, airport equipment, airport handling services, sales distribution, catering, training, aviation insurance and other costs. Thus all but a small percentage of the income from ticket sales is paid out to a wide variety of external providers or internal cost centers.Moreover, the industry is structured so that airlines often act as tax collectors. Airline fuel is untaxed, however, due to a series of treaties existing between countries. Ticket prices include a number of fees, taxes, and surcharges they have little or no control over, and these are passed through to various providers. Airlines are also responsible for enforcing government regulations. If airlines carry passengers without proper documentation on an international flight, they are responsible for returning them back to the originating country.Analysis of the 1992-1996 period shows that every player in the air transport chain is far more profitable than the airlines, who collect and pass through fees and revenues to them from ticket sales. While airlines as a whole earned 6% return on capital employed (2-3.5% less than the cost of capital), airports earned 10%, catering companies 10-13%, handling companies 11-14%, aircraft lessors 15%, aircraft manufacturers 16%, and global distribution companies more than 30%. (Source: Spinetta, 2000, quoted in Doganis, 2002)In contrast, Southwest Airlines has been the most profitable of airline companies since 1970.[citation needed]The widespread entrance of a new breed of low cost airlines beginning at the turn of the century has accelerated the demand that full service carriers control costs. Many of these low cost companies emulate Southwest Airlines in various respects, and like Southwest, they are able to eke out a consistent profit throughout all phases of the business cycle.[citation needed]As a result, a shakeout of airlines is occurring in the U.S. and elsewhere. United Airlines, US Airways (twice), Delta Air Lines, and Northwest Airlines have all declared Chapter 11 bankruptcy. Some[who?] argue that it would be far better for the industry as a whole if a wave of actual closures were to reduce the number of "undead" airlines competing with healthy airlines while being artificially protected from creditors via bankruptcy law. On the other hand, some[who?] have pointed out that the reduction in capacity would be short lived given that there would be large quantities of relatively new aircraft that bankruptcies would want to get rid of and would re-enter the market either as increased fleets for the survivors or the basis of cheap planes for new startups.Where an airline has established an engineering base at an airport then there may be considerable economic advantages in using that same airport as a preferred focus (or "hub") for its scheduled flights.[edit] Assets and financingThe Boeing 777-200 of Malaysia AirlinesAirline financing is quite complex, since airlines are highly leveraged operations. Not only must they purchase (or lease) new airliner bodies and engines regularly, they must make major long-term fleet decisions with the goal of meeting the demands of their markets while producing a fleet that is relatively economical to operate and maintain. Compare Southwest Airlines and their reliance on a single airplane type (the Boeing 737 and derivatives), with the now defunct Eastern Air Lines which operated 17 different aircraft types, each with varying pilot, engine, maintenance, and support needs.A second financial issue is that of hedging oil and fuel purchases, which are usually second only to labor in its relative cost to the company. However, with the current high fuel prices it has become the largest cost to an airline. While hedging instruments can be expensive, they can easily pay for themselves many times over in periods of increasing fuel costs, such as in the 2000-2005 period.In view of the congestion apparent at many international airports, the ownership of slots at certain airports (the right to take-off or land an aircraft at a particular time of day or night) has become a significant tradable asset for many airlines. Clearly take-off slots at popular times of the day can be critical in attracting the more profitable business traveler to a given airline's flight and in establishing a competitive advantage against a competing airline. If a particular city has two or more airports, market forces will tend to attract the less profitable routes, or those on which competition is weakest, to the less congested airport, where slots are likely to be more available and therefore cheaper. Other factors, such as surface transport facilities and onward connections, will also affect the relative appeal of different airports and some long distance flights may need to operate from the one with the longest runway.[edit] Airline partnershipsCode sharing is the most common type of airline partnership; it involves one airline selling tickets for another airline's flights under its own airline code. An early example of this was Japan Airlines' code sharing partnership with Aeroflot in the 1960s on flights from Tokyo to Moscow: Aeroflot operated the flights using Aeroflot aircraft, but JAL sold tickets for the flights as if they were JAL flights. This practice allows airlines to expand their operations, at least on paper, into parts of the world where they cannot afford to establish bases or purchase aircraft. Another example was the Austrian- Sabena partnership on the Vienna-Brussels-New York JFK route during the late 60's, using a Sabena Boeing 707 with Austrian colors.Since airline reservation requests are often made by city-pair (such as "show me flights from Chicago to Düsseldorf"), an airline who is able to code share with another airline for a variety of routes might be able to be listed as indeed offering a Chicago-Düsseldorf flight. The passenger is advised however, that Airline 1 operates the flight from say Chicago to Amsterdam, and Airline 2 operates the continuing flight (on a different airplane, sometimes from another terminal) to Düsseldorf. Thus the primary rationale for code sharing is to expand one's service offerings in city-pair terms so as to increase sales.A more recent development is the airline alliance, which became prevalent in the 1990s. These alliances can act as virtual mergers to get around government restrictions. Groups of airlines such as the Star Alliance, Oneworld, and SkyTeam coordinate their passenger service programs (such as lounges and frequent flyer programs), offer special interline tickets, and often engage in extensive codesharing (sometimes systemwide). These are increasingly integrated business combinations-- sometimes including cross-equity arrangements-- in which products, service standards, schedules, and airport facilities are standardized and combined for higher efficiency. One of the first airlines to start an alliance with another airline was KLM, who partnered with Northwest Airlines. Both airlines later entered the SkyTeam alliance after the fusion of KLM and Air France in 2004.Often the companies combine IT operations, buy fuel, or purchase airplanes as a bloc in order to achieve higher bargaining power. However, the alliances have been most successful at purchasing invisible supplies and services, such as fuel. Airlines usually prefer to purchase items visible to their passengers to differentiate themselves from local competitors. If an airline's main domestic competitor flies Boeing airliners, then the airline may prefer to use Airbus aircraft regardless of what the rest of the alliance chooses.[edit] Environmental impactsMain article: Aviation and the environmentAircraft engines emit noise pollution, gases and particulate emissions, and contribute to global warming[3][4] and global dimming.[5]Modern turbofan and turboprop engines are considerably more fuel-efficient and less polluting than earlier models. However, despite this, the rapid growth of air travel in recent years contributes to an increase in total pollution attributable to aviation, offsetting some of the reductions achieved by automobiles. In the EU greenhouse gas emissions from aviation increased by 87% between 1990 and 2006.[6]In the context of climate change and peak oil, there is a debate about possible taxation of air travel and the inclusion of aviation in an emissions trading scheme, with a view to ensuring that the total external costs of aviation are taken into account.[7]The airline industry is responsible for about 11 percent of greenhouse gases emitted by the U.S. transportation sector. Boeing estimates that biofuels could reduce flight-related greenhouse-gas emissions by 60 to 80 percent. The solution would be blending algae fuels with existing jet fuel: [8]Boeing and Air New Zealand are collaborating with leading Brazilian biofuels maker Tecbio and Aquaflow Bionomic of New Zealand and other jet biofuel developers around the world.Virgin Atlantic and Virgin Green Fund are looking into the technology as part of a biofuels initiative. [9][edit] Call signsEach operator of a scheduled or charter flight uses a airline call sign when communicating with airports or air traffic control centers. Most of these call-signs are derived from the airline's trade name, but for reasons of history, marketing, or the need to reduce ambiguity in spoken English (so that pilots do not mistakenly make navigational decisions based on instructions issued to a different aircraft), some airlines and air forces use call-signs less obviously connected with their trading name. For example, British Airways uses a Speedbird call-sign, named after the logo of its predecessor, BOAC, while America West used Cactus reflecting that company's home in the state of Arizona and to differentiate itself from numerous other airlines using America and West in their call signs.[edit] Airline personnelThe various types of airline personnel include:Flight crews, responsible for the operation of the aircraft. Flight crew members include:Pilots (Captain and First Officer: some older aircraft also require a Flight Engineer)Flight attendants, (led by a purser on larger aircraft)in-flight security personnel on some airlines (most notably El Al)Groundcrew, responsible for operations at airports. Ground crew members include:Aerospace and avionics engineers responsible for certifying the aircraft for flight and management of aircraft maintenanceAerospace engineers, responsible for airframe, powerplant and electrical systems maintenanceAvionics engineers responsible for avionics and instruments maintenanceAirframe and powerplant techniciansElectric System technicians, responsible for maintenance of electrical systemsAvionics technicians, responsible for maintenance of avionicsFlight dispatchersBaggage handlersRampersGate agentsTicket agentsPassenger service agents (such as airline lounge employees)Reservations agents, usually (but not always) at facilities outside the airport.Airlines follow a corporate structure where each broad area of operations (such as maintenance, flight operations, and passenger service) is supervised by a vice president. Larger airlines often appoint vice presidents to oversee each of the airline's hubs as well. Airlines employ lawyers to deal with regulatory procedures and other administrative tasks.[citation needed][edit] Industry TrendsThe headquarters of Air India in Mumbai, India.The pattern of ownership has gone from government owned or supported to independent, for-profit public companies. This occurs as regulators permit greater freedom and non-government ownership, in steps that are usually decades apart. This pattern is not seen for all airlines in all regions.[original research?]The overall trend of demand has been consistently increasing. In the 1950s and 1960s, annual growth rates of 15% or more were common. Annual growth of 5-6% persisted through the 1980s and 1990s[citation needed]. Growth rates are not consistent in all regions, but countries with a de-regulated airline industry have more competition and greater pricing freedom. This results in lower fares and sometimes dramatic spurts in traffic growth. The U.S., Australia, Canada, Japan, Brazil, Mexico,India and other markets exhibit this trend. The industry has been observed to be cyclical in its financial performance. Four or five years of poor earnings precede five or six years of improvement. But profitability even in the good years is generally low, in the range of 2-3% net profit after interest and tax. In times of profit, airlines lease new generations of airplanes and upgrade services in response to higher demand. Since 1980, the industry has not earned back the cost of capital during the best of times. Conversely, in bad times losses can be dramatically worse. Warren Buffett once said that despite all the money that has been invested in all airlines, the net profit is less than zero. He believes it is one of the hardest businesses to manage.[citation needed]As in many mature industries, consolidation is a trend. Airline groupings may consist of limited bilateral partnerships, long-term, multi-faceted alliances between carriers, equity arrangements, mergers, or takeovers. Since governments often restrict ownership and merger between companies in different countries, most consolidation takes place within a country. In the U.S., over 200 airlines have merged, been taken over, or gone out of business since deregulation in 1978. Many international airline managers are lobbying their governments to permit greater consolidation to achieve higher economy and efficiency.