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Supposing the cost of this upgrade (given that they already have monitors in the seats) is $50 per seat. You could either apply that $50 to the cost of a single tank of fuel, or spend it on something permanent. This permanent new feature would then give United a differential advantage, and if someone with an iphone has a good incentive to fly United. This, in turn, bring them more revenue allowing them to reduce cost via economies of scale.

So, this may actually accomplish lowered ticket prices over the long term.

I work at the company that builds these systems, and trust me, it costs a lot more than $50 to add this to a seat. These are low volume units that need to pass all kinds regulations to be allowed on an aircraft.

As for the trickle down, you will most likely see these in more classes as aircraft are replaced and the new iPod units can be built in from the start. Replacing existing units it too expensive, especially given the current fuel costs.
 
It's also because only first/business class flyers have their own monitors.

One reason to love JetBlue. All flights have all seats with TV's on them. Granted they are not 15" but it certainly does the trick. If I could plug my iPhone into that on a trip, I'd be set!
 
So, United is going to pay to install iPod connectors for first and business class, but is going to charge coach class customers to check even one bag?
exactly, they're not lowering costs at all by providing this feature to elite customers. Quite the opposite, now that they've spend the money integrating this new tech, they're not able to cover the increases in fuel prices and are now asking their customers to pay for it on top of their regular ticket price. If they're going to do this, they should also sell tickets in weight classes(not such a bad idea really, fatties).
 
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