context: travel loyalty programs designed to award travelers choosing to use one particular airline on a regular basis.

First introduced in 1970 by American Airlines and soon followed by almost every large and small airline. Around the world, the airlines have about 100 million members in their programs with some 3.7 trillion miles collected all together. Frequent flyers programs are an excellent example of one-to-one marketing, or Marketing 101; give something for nothing and build loyalty at the same time.

The way the programs work is that they award the member passenger a certain amount of points - usually called miles - for flights. The amount of points is proportional to the length of the flight and usually also to level of service purchased. Points may then be exchanged for free flights ("award travel"), upgrades to higher class of service and other things. Most frequent flyer programs have several award levels - e.g. Silver, Gold, Platinum, Royal, Executive etc - , which are attained after collecting a specific amount of points. The higher award levels usually give access to airport lounges and give priority on waiting lists etc. Points can also be earned in various ways such as car rentals, hotel stays, using specific calling plans or just by using a specific credit card. About 50% of the points earned are earned on the ground, i.e. not by actually flying. 

The programs are often criticized for skewing the competition between airlines, since they make people choose business travel not by prices but based upon what program the individual is a member of. Sweden recently judged parts of the Scandinavian Airlines Systems (SAS) bonus program illegal on domestic routes, because of this. The programs have also become increasingly restrictive when it comes to award travel. Most programs have blackout dates and only a few seats allotted to awards travel on popular routes. This means that it can be hard or sometimes impossible to use your points to get to popular destinations. In general, between 4 and 9% of the seats were given to people in exchange for frequent flyer points. 

Like any reward program (American Express, Diners etc), the value of your points vary greatly. Using your points on upgrades rather than award travel usually makes more sense economically, since the same 25,000 points will exchange for a $500 domestic trip and $1000 business class seat. Some airlines have occasionally made it possible to upgrade your seat to one in the cockpit, and some frequent flyers of United had their names painted on the planes

Recently, the airlines have created large alliances in order to provide better services, more destinations and more loyal customers. This means that you can earn and use points/miles with several airlines more freely than with the traditional "partner" airlines.  

Some programs and alliances:

Airline          -    Program    -      Alliance
Aer Lingus            TAB               oneworld
Aero California       Club Altus
AeroMexico            Club Premier      SkyTeam
Air Canada            Aeroplan          Star Alliance
Air France            Frequence Plus    SkyTeam
Air New Zealand       Air Points        Star Alliance
AirTran               APlus Rewards
Alaska Airlines       Mileage Plan
All Nippon Airways    ANA Mileage Club  Star Alliance
Aloha Airlines        AlohaPass
America West Airlines FlightFund
American Airlines     AAdvantage        oneworld
Ansett Australia      Global Rewards    Star Alliance
Asiana Airlines       Asiana Bonus Club
British Airways       Executive Club    oneworld
British Midland       Diamond Club      Star Alliance
BWIA West Indies Air  BWee Miles
Cathay Pacific        Asia Miles        oneworld
China Airlines        Dynasty Flyer
Continental Airlines  OnePass
Crossair                                Qualiflyer
Delta Air Lines       SkyMiles          SkyTeam
EL AL Israel Airlines Frequent Traveler Matmid Club
Finnair               Finnair Plus      oneworld
Gulf Air Falcon
Hawaiian Airlines     HawaiianMiles
Howard Johnson        SuperMiles
Iberia Airlines       Iberia Plus       oneworld
Japan Airlines        JAL Mileage Bank
KLM                   Flying Dutchman
Korean Airlines       Skypass           SkyTeam
LanChile              LanPass           oneworld
Lufthansa             Miles & More      Star Alliance
Malaysia Airlines     Enrich
Malev Hungarian Air   Duna Club
Mexicana Airlines     Frecuenta         Star Alliance
Midwest Express       Frequent Flyer
Northwest Airlines    WorldPerks
Phillipine Airlines   PALsmiles
Qantas Airways        Frequent Flyer    oneworld
Sabena                                  Qualiflyer
SAS                   EuroBonus         Star Alliance
Singapore Airlines    KrisFlyer         Star Alliance
South African Airways Voyager
Southwest Airlines    Rapid Rewards
Swissair                                Qualiflyer
Tarom Romanian Air    Smart Miles
Thai Airways Int'l    Royal Orchid Plus Star Alliance
Trans World Airlines  Aviators
United Airlines       Mileage Plus      Star Alliance
US Airways            Dividend Miles    oneworld
Varig                 Smiles            Star Alliance
Virgin Atlantic Air   Flying club
Reference: USA Today,