Commercial airplane tickets are divided up into coach, business class, and first class. In 2014, Etihad introduced The Residence, a premium experience above first class. The Residence isn't very popular.

The reason The Residence isn't very popular is because of economics. A Residence flight is almost as expensive as a private charter jet. Private jets aren't just a little bit better than commercial flights. They're a totally different product. The airplane waits for you, and you don't have to go through TSA (or Un-American equivalent). The differences between flying coach and flying on The Residence are small compared to the difference between flying on The Residence and flying a low-end charter jet.

It's difficult to compare costs of big airlines vs private jets for a myriad of reasons. The exact details of this graph should not be taken seriously. I'm just trying to give a visual representation of how a price bifurcation works. Even in the rare situations where it's slightly cheaper than a private jet, nobody should buy them. Rich people should just rent low-end private jets, and poor people shouldn't buy anything more expensive than first class tickets. Why was Etihad's silly product created? Mostly for the halo [...]

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Outline:

(01:55) Definition

(03:16) Product Bifurcation

(04:55) The Death of Live Music

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First published:
December 16th, 2025

Source:
https://www.lesswrong.com/posts/7zkFzDAjGGLzab4LH/dancing-in-a-world-of-horseradish

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Narrated by TYPE III AUDIO.

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