Reading this it would seem that you believe Disney is willingly giving away money out of good heart. Since we both know it's not even remotely possible, there must be other explanations. I can see two possible ones.
I would probably call it “good faith”, but yeah, same idea. It seems troublesome / burdensome to track the exact source (or destaintion?) of that revenue on every cash booking. Imagine Aulani has 3 One Bedroom villas available to cash guests; one is the result of an owner trading points for a
Disney cruise, another is offered because DVC hasn’t sold all of the points and the third is made available via breakage. Disney sells one of those rooms. Which bucket gets the money?
I’ve worked with some large accounting systems before. Frankly, trying to track this activity on literally tens-of-thousands of guest rooms year-round may be more costly than making assumptions which (at worst) err in the members’ favor.
1) unused points trickle down from the most desirable resorts to the less desirable. At BCV or VGF if members don't use their points, people from other resorts will take their place so they're 100% booked. The rooms that remain empty are most probably at Aulani, SSR, OKW, VB and HI. Those rooms are sold by Disney for cash, but it wouldn't be fair for the system to give breakage income to those resorts only, so the money are redistributed between resorts. They might have a way to calculate which points went into breakage at each resort, but it's more probable that the breakage income is so higher than the total cap that they just don't care and allocate it evenly and keep the change (the change here is a check with multiple zeros).
The difficult part of this discussion is we have no idea of the volume. We know Disney resorts don’t operate at 100% occupancy (it’s typically closer to 88-90%). Due to the popularity of point renting, there are cheaper ways to book DVC villas. Members often grab all of the studios, leave 1B and 2B villas which are less desirable for cash guests. If the rooms are heavily discounted and bundled with dining plans or ticket offers, Disney is taking a healthy cut off the top with little breakage income left. Specific to Aulani, the millions of unsold points mean that Disney has access to 100% of the cash revenue on dozens (if not hundreds) of cash villas every night.
Is Disney REALLY doing this becuase it views <90 day cash reservations for larger DVC villa rooms—above and beyond the current breakage threshold—as a profit center? Particularly when they have unhooked hotel rooms at locations they own outright?
If nothing else, it seems we agree that there’s probably some fairness principle being applied.
2) every time a lockoff is split and booked as a studio + 1BRm extra points are generated. Disney keep track of those into a pool they use to book rooms like they do with their own points. This generates breakage income also at resorts were rooms very rarely reach the breakage time.
I strongly disagree with the idea that these transaction are “generating” points which are actively tracked by Disney to their benefit. The breakage rules are pretty straightforward—it applies to unblocked rooms 90 days before arrival. Before that point, members have full access to their room inventory which includes the ability to use banked or borrowed points toward those rooms.
Referring back to one of my prior posts, BCV has about 3 million points but it requires 3.28 million to book all lockoffs separately. I don’t see that as “creating” 280K points that DVC can do with as it wishes. That’s not how breakage works. Those charts create additional capacity which can be used by BCV owners who have banked or borrowed points, or owners of other resorts.
My skepticism is rooted in the fact that we’re talking about expensive cash rooms which are inherently undesirable by both members and non-members, in a resort system which does not operate at 100% occupancy.
This lockoff bump has always been with us. Up thru 2019 it takes 3.22 million points to book all of the BCV lockoffs separately. I understand (and relate!) to the frustration over the widening of that gap, but I’m not convinced that Disney has self-serving motivations. I would be really curious to see how member banking and borrowing activity has changed over the years. Given the tens-of-millions of points now in the DVC system, a couple percentage point change in banking or borrowing activity from year-to-year can have a dramatic impact on availability.
Bill
