On thursday I've read on the ATW daily newsletter that Ryanair is going to open its 6th base in Barcelona, meaning that Ryanair flies to another main Spanish airport after Madrid. At the same time Ryanair announced to discontinue its operation to and from Prague because the airport management isn't willing to reduce the airport fees.

When comparing the airport fees of Barcelona and Prague for a typical 737-800 operation, the charges at El Prat airport are only 35% of those at Prague airport for a 737-800 rotation with a passenger load factor of 100%. The total costs per passenger are at 8,30 Euros in Barcelona and more than 20 Euros in Prague.

This shows that there is some competition between airports when it comes to the operation of Low Cost Carriers. The question is whether it is a useful approach for airports to enter a strong price competition since there are other airlines that are ready to pay the high prices despite complaining about the fees.

Anyway, with Ryanair increasingly operating from main airports rather than secondary airports, airports in general may have to deal with the question of how to attract airlines with non-traditional business models in order to maximize the capacity optimization of their infrastructure. Is it by means of price or product differentiation or something else?

The question is whether this is the beginning of the expected redesign of airport business models. Airports facing overcapacity are going to reduce their fees and hence create a competitive environment. Reducing airfares increases the attractiveness of a certain destination which will in turn lead to reactions of other airports. In the end this may result in a strong price war if there's no time for a planned reaction.

Airports! It's high time to think of and create a new business model! This is basically what I want to get across here.

How could this work? Let's have a quick look at another very capital-intensive industry: telecomunications. The long-term monopolies with rather high fees have mainly been liberalized by now which led to unit fees at - in some cases - zero for basic services, but in turn additional costs for flat rate-schemes and special services have been introduced. What about the flat-rate airport or zero costs for basic services at airports? Would this be a viable option? What do you think?