It has been one of the business world's best-kept secrets: Why do you pay so much more or less for an airline ticket than the person in the seat next to you?

To crack the code, you would literally have to survey every passenger. Channel 4 Action News anchor Wendy Bell did just that. What she found will change everything you thought you knew about how to save money.

The following is Bell's special report, which first aired May 3, 2004, on Channel 4 Action News at 6 p.m.

---

You know the drill: 14 days in advance, Saturday night stay, check the discount Web sites. Well, forget it. We found that it doesn't matter when you book your flight, where you're going, how many seats you're buying, or where you get those tickets.

Video

Watch Bell's Report: Part 1 Part 2

There's little rhyme or reason behind who gets the better price. In fact, the strategy the major airlines use to price their seats -- a strategy literally developed by rocket scientists -- is so old and so confusing that experts say it may cost airlines like US Airways their wings.

Our flight was US Airways 2184 from Pittsburgh to Miami. It's a full flight with 144 passengers. Most are stopping in Miami, some are catching cruises and about 10 percent are flying on.

Passenger: "We're doing layovers. We started at BWI (Baltimore), ended up here, and we're flying from Pittsburgh straight through back down to Miami."

Bell: "How much?"

Passenger: "It was a little over $199."

Bell: "So, $300 you saved each. Worth it?"

Passenger: "Very."

It's a good price, but was it the best?

"About $200."

"$430."

"$580, $600, something like that."

This man booked his flight a month ago for $400 dollars.

Bell: "If I told you I booked my reservation a week and a half ago and paid $250, how would you feel about that?"

Passenger: "Ripped off."

Bell: "Would it bother you?"

Passenger: "Yeah. But did you?"

Bell: "Yes."

Passenger: "Then it bothers me."

Once airborne, we handed out 144 questionnaires. How much did our fellow passengers pay for today's flight, and when did they book their trips? Ninety-two people responded. They paid 53 different fares, all coach, ranging from $166.80 to $1,115. That's a difference of $948.

In some cases, longer trips even meant lower fares.

The woman in 14C is connecting in Miami to Key West. She paid $340 four weeks ago. The man in 10F also booked four weeks ago. His trip is shorter; it ends in Miami. But he's paying $680.

Yes, 14C is flying farther for half the price. Surprising?

Christopher Elliot, travel expert: "Not at all. The airlines have had a confusing fare structure for years."

Elliott says the pricing software that most major airlines use is designed to react to each other's fare changes. If Southwest Airlines changes its fares, US Airways follows suit.

Elliott: "Travel agents can sit at their terminals and they can literally watch the fares change by the minute."

That's what happened to us. The price of our flight on USAirways.com dropped from $658 to $246 in 30 minutes. One day later, the price rebounded to $1,096.

Elliott: "You get a price online, you get up, get a cup of coffee, come back, price is gone."

How about this? The business traveler in 18F booked her flight 10 days ago through a corporate travel agent for $1,115. The couple in 22A and 22B bought their tickets online the same day for only $190 each. Same trip, same day, $925 less.

Bell: "How do you feel knowing that you paid $190, you booked on the same day as a woman 10 rows up, and she paid $1,100?"

Passenger: "I feel bad for her. That's terrible."

We also found that passengers who bought tickets weeks or months early didn't always save money.

Remember the man in 10F who booked his flight one month ago for $680? Four rows behind him, the man in 14F booked his flight two weeks later but for a lot less: $190.

Elliott: "These ticket prices aren't based on fairness. They're based on how much money the airline can take from you, the consumer."

We asked US Airways to sit down with us and explain its pricing strategy, but the company said that information is "tightly guarded" and revealing it would be an antitrust violation.

US Airways lost $624 million last year -- more than $1.5 million a day. When we asked a company spokesman about that, he would only say the airline is revamping its pricing formula.

We did learn this much:

Twenty-four employees manage the pricing structure for US Airways flights, tinkering with thousands of airfares every day to maximize the airline's profits.

Another 25 to 30 employees work in inventory management, divvying up the seats by price to determine who gets what seat at which fare, and when.

These workers control the pricing in 16,000 markets every day, tweaking a total of 64,000 base fares, which can be combined into more than 500 million different rates.

On our flight alone, there were 1,764 possible fares. In the week before our flight, US Airways made 3,215 airfare changes to flights into and out of Pittsburgh.

According to statistics from the Bureau of Transportation, US Airways needed to fill 88 percent of its seats to break even in the fourth quarter of 2003. The airline didn't quite make it. They filled 73.5 percent. By the end of the year, they were $624 million in the red.

Elliott: "US Airways has a deficient, defective pricing system, and they are losing money over it. They have lost the trust of their passengers. In a city like Pittsburgh, for example, your fares are almost twice what they are anywhere else."

That leaves passengers baffled and burned when fares soar sky high.

Passenger: "The people sitting next to me did not pay $1,100 to fly. I could have bought all these seats for that amount of money."

People who track the airline industry tell us there's no question ticket prices in Pittsburgh are 20 percent higher than the national average.

While US Airways wouldn't go on camera with us, the company says it is trying to keep fares low. We learned that's true. They are moving to simplify the pricing structure into four tiers.

Tuesday on Action News at 6 p.m.: The tickets airlines don't want you to buy. Secrets to beating the system and getting the best seat at the best price.