Online at what cost?
- By Thomas R. Temin
- Sep 14, 2001
Thomas R. Temin
Should it cost more to go first class? If you are an airline, you do everything in your power to get premium fees for premium service. As a traveler, you can pay a few hundred bucks to go cattle-car to London, or a few thousand to have Johnnie Walker Blue Label served in real glass at your flying leather Barcalounger.
In Paris, for a few extra centimes, you can go in first-class subway cars. One time my wife and I accidentally stepped onto the premiere car, wondering why it was so uncrowded. At the next stop, a guard admonished us to squeeze back in with the proletariat.
In such cases, premium services cost more to produce and deliver to those with the means to pay for them. A Boeing 747 has around 21 seats in first class and hundreds in the back. Everyone gets to the same destination, but it costs more to deliver the lucky 21.
Should government offer premium services? The precedent has been set by the Immigration and Naturalization Service, which, for an extra fee of $1,000, will expedite certain visa applications, guaranteeing an answer in 15 days. Every application is processed by the same rules, but the $1,000 will get an applicant through the process weeks or months sooner.
I believe more agencies are going to face the question of whether to charge for premium services, especially online services. So far, Internet dynamics have favored discounts for online services. Many airlines, to continue with that example, now discount by 15 percent tickets purchased online. The theory here, as for government, is that you cut expensive people- and paper-handling from the process.
Yet there is precedent for charging more'not because of higher costs to provide the service but because people will pay for convenience. For instance, Alabama tax officials charge businesses a fee for online filing.
Besides, few agencies really know what it costs them to provide online service, especially given the tremendous capital costs some of these systems entail. Because government is government, it will be decades before agencies are able to shutter mail-in, walk-in or call center services. Old-service costs won't disappear.
Either way, it would be premature to assume online means free.
Thomas R. TeminEditorial director
E-mail: [email protected]