Delta axes last-minute frequent flier fee

"It's two steps forward and one step back," said Tim Winship, publisher of FrequentFlier.com.

Delta has long charged for short-notice mileage redemption. The fees  being eliminated were $150 for an award booking within three days of travel; $100 within four to seven days; and $75 within eight to 20 days.

Several Delta competitors charge redemption fees, but United Airlines eliminated them last July. Now United plans to merge with Continental Airlines to become the world's largest carrier surpassing Delta, amping up the competition between the two.

Meanwhile, Delta also is trying to win over customers of merger partner Northwest Airlines, particularly targeting them to sign up for a Delta SkyMiles American Express card.

"We've listened to our customers and one of the things that we've heard for a while is that this particular fee for close-in redemption was something that they were clear about in their feedback," said Delta spokesman Paul Skrbec. "They expressed some dissatisfaction in it and so this is a response to that."

Winship said from a consumer perception standpoint, "Delta's program is one of the most reviled these days." He said some customers believe it is extremely difficult to redeem miles at the lowest tier on Delta, or 25,000 miles for most domestic round trips. In a study last month by consulting firm IdeaWorks, Delta ranked second to last in award seat availability.

"With the competitive pressure from United plus the situation they're in with respect to public perception, I think that this is basically being forced upon them," Winship said.

Though the rush fees for award flights have been lifted, Skrbec said many award seats for the summer have already been booked, and that availability is better for fall.