Patent ID: 8600787

Claim:
A system, comprising: a network interface communicating with a memory; the memory communicating with a overbooking optimization processor; the processor, when executing a computer program, executes operations comprising: calculating by the processor, a flight authorization level (AU) that minimizes an overbooking cost associated with the flight, the flight with a coach seating capacity (CAP), wherein the overbooking cost is determined by: ∑ n = 0 μ + 3 ⁢ σ ⁢ P ⁡ ( x = n ) × [ SSCost n + DBCost n ] ⁢ where: x=# no shows for a flight SSCost n =SSCost(max[ n −(AU−CAP),0]) DBCost n =DBCost(max[(AU−CAP)− n, 0]) x ˜Binomial(AU, p =“No-Show-Rate”) P ⁡ ( x = n ) ≡ ( A ⁢ ⁢ U n ) ⁢ p n ⁡ ( 1 - p ) ( AU - n ) μ=AU× p σ=√{square root over (AU× p ×(1 −p ))} and wherein DBcost n is associated with the DB cost of the n th passenger that is denied boarding and is determined by: DBcost n =DDB n *[(1−ncf)*(voucher_amt* b *pv n +(ill_will+exp_invol_cost n )*1−pv n )+HMT n )], where ncf=no compensation factor=the percentage of passengers denied boarding that do not qualify to be compensated; voucher_amt=an amount of a voucher offered to passengers who volunteer to DB; b: Breakage factor, the expected percentage of voucher dollars that will be used; pv n : given n passengers who are denied boarding to the flight, pv n is the expected percentage of volunteers; ill_will: Extra cost added due to bad customer image and possible loss of customers due to involuntarily denying boarding to passengers; exp_invol_cost n : an expected payout to an involuntary DB passenger; HMT n =an expected accommodation cost of the n th DB passenger; and DDB n =a double DB factor.