Airline Brands---Are They Irretrievably Broken?

The Coalition for an Airline Passengers' Bill of Rights, a consumer advocacy group, is petitioning for federal legislation to ensure air travelers receive basic human necessities while onboard an aircraft---as in breathable air, food, water and clean working toilets---and they want restrictions on how long an airline can require passengers to remain aboard a delayed flight. The proposed Passenger Bill of Rights also includes provisions for travelers to be compensated for cancelled or delayed flights, for luggage that is lost for a certain period of time, etc.

Some airlines are blaming problems on increased air traffic and an overtaxed air traffic control system. Others claim they have their own rules in place to relieve traveler discomfort and inconvenience "as much as possible." (What does that mean, exactly?)

Air transportation is a tough business, what with rising fuel costs, security requirements, the above referenced air traffic control system and a mature product with numerous competitors. It's also painfully evident that many air travelers believe there's as much difference between airlines as there is between subway cars or city buses. Travelers and airlines are locked in a symbiotic relationship for which there seems to be no escape. Let's face it, we don't like flying but we still do.

So in an industry where meaningful brand differentiation has all but disappeared, and customers are trying to enact legislation forcing airlines to provide a basic level of customer service, are airline brands irretrievably broken? If not, what are the steps they need to take to restore customer trust?