It’s no secret that the airline industry has issues. Soaring fuel costs, have left airlines scrambling for ways to increase revenues. Instead of just raising fares and cutting capacity, airlines have decided to nickel and dime travelers to death. Just yesterday the Israeli El Al airlines decided to start charging travelers more for seats in an emergency row. This follows other airlines charging for pillows, food, luggage…etc.

Customers are getting fed up with an ever expanding list of fees. In an age where most industries have made their fee structures much more simple, the airlines have decide to drive us crazy. ” Sir, you’d like ice with your beverage? That’ll be 3 bucks.” Or “Miss, I am sorry but since your shoes have high heels, that’ll be $2.”

You know, if airlines really wanted to be fair about each individuals contribution to the amount of fuel used per flight, and then charge accordingly, they could use the supermarket method. When we go shopping, for many items, we pay per pound. Fruits, vegetables, ground beef all priced according to weight. Why don’t the airlines follow suit? Why should someone who is thin, pay the same amount as someone with a bit more girth? After all, our weight-challenged traveler causes more fuel to be used than our thin traveler.

Stop the madness. Just raise fares. It’s that simple.

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Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.

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Zack Miller
www.IsraelNewsletter.com

As investors in opportunity, we have our tentacles to the ground (to mix metaphors) to see how world events affect our portfolio companies. IOI’s Aaron Katsman wrote recently how trouble in Pakistan could spell good things for NICE Systems (Nasdaq: NICE).

Now, we have an upgrade coming from UBS for NICE on the back of the scandal at Societe Generale. From the research note:

In particular, we view the current regulatory environment as conducive to the sale of recording systems and fraud/compliance solutions. With nearly 50% of 2008 management guidance already in the backlog, and given the strong booking momentum in hand, we see limited downside risk to consensus numbers.

We also read of a new deal signed with Go Daddy this morning to deploy a call center solution for Go Daddy’s 1000+ reps for better insight and metrics into service calls.

It’s hard to say, like NICE did recently, that a global slowdown would actually benefit the firm. In a global slowdown, this firm, like many service providers would most likely get hit as well. The nice thing about NICE though is that its focus on compliance and risk management should help it to weather the storm.

Disclosure: Author’s fund has a position in NICE as of 2/18/08.

Please see our Disclaimer HERE.

NEW! Introducing Israel Opportunity Investor, our monthly subscription-only newsletter. Stay ahead of the game and make smart decisions in Israel stocks. Go here to learn more.

Zack Miller is Managing Editor of the Israel Opportunity Investor newsletter. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email zack@israelnewsletter.com.

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