Brill Says No Guarantee for FLO Customers
By Kendra Marr
Steven Brill is not happy.
The New York media mogul was miffed to hear that FLO was advertising that its new Redskins-branded smart card, which promises to speed Redskins fans into FedEx Field faster, would also give fans access to the special airport security lanes at Reagan National and Dulles International airports.
"There's no guarantee that their cards are going to continue to be recognized," Brill said.
Here's the issue: When the Transportation Security Administration first set up the registered traveler program, it maintained that all registered travelers must be able to use any service provider's card at any fast lane. Brill, who owns FLO competitor Verified Identity Pass, pays to staff and operate fast pass security lanes at 17 of the 19 registered traveler airports, including Reagan and Dulles. FLO operates one at Reno-Tahoe International Airport.
So, Brill said, it just isn't fair that FLO members have been able to use Verified's lanes, which eat about two-thirds of the company's operating costs, free of charge. But recently the tide has turned in this heated competition between FLO and Verified. The administration has expanded the private sector's reach into this new industry by lifting a cap that limited the fast lanes to 20 airports and eliminating the mandatory $28 government background check. And it said that for at least 12 months, the lanes have to remain open to cardholders regardless of operator.
After that, Brill said, Verified might start blocking FLO cards unless the Chantilly start-up starts paying him a fee for its members to use Verified lanes.
"If we can't collect money from them, we have the legal option to stop them," Brill said.
Today, FLO has signed up about 5,000 members for its card, which offers added benefits like hotel discounts, while Verified's membership totals about 190,000.
Luke Thomas, executive vice president of FLO, said that in the next year vendors will probably negotiate a system much like what competing banks did when they first opened ATMs.
And Thomas issued his own warning: "If he cuts us off, his members will be cut off at our airport in Reno. Obviously he has more airports, but this would just shoot the entire industry in foot."
August 4, 2008; 3:16 PM ET
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