Air Australia nominated the Brisbane-Melbourne route for the latest domestic air fare blood bath today, launching a new web site and one way economy fares from $69 or business class from $499 one way from 15 December.

A quick look at competition on that day showed that Jetstar (via the Qantas web site) was offering $133, while Qantas had seats at $155 in economy and $969 in business class.

Virgin Australia had economy seats at $125 and premium economy at $545  (which may well be its pending business class, which doesn’t officially launch on east coast inter city routes until after the New Year).

Tiger had seats at $99.95.

However consumers, and new entrants like Air Australia, beware.

Domestic air fares go up and down faster than… um, anything you can think of, according to what game the airliners choose to play, as they ‘yield manage’ price and volume, pursue ‘legitimate competitive responses’,  or indulge in a bit of infanticide when it comes to newly born entrants, especially on the ‘golden triangle.’

Nor do consumers ever know exactly how many seats were ever offered at a particular price, however they do see tags on the airline booking sites with indications that only a few seats are left if the airlines feel like showing them.

Michael James the owner of Air Australia knows this of course. We should be grateful for his persistence in aiming his sling shot at the Goliaths, as well as Tiger, which like him, knows what it is like to be unloved.

Air Australia means better deals for the customers of all the Brisbane-Melbourne airlines, for as long as it takes.