There's a cool article over at CNNMoney about how an airline company in Ireland is predicting in a few years flights will be free. While it seems far-fetched, Ryanair already provides free flights to about 1/4 of their current customers.

How do they pull this off? With a combination of agressive cost-cutting and additional revenue streams. On the cost-cutting side, they do things like remove back-of-the-seat pockets, don't have free peanuts, etc. Every cent saved counts. On the additional revenue side, they charge for everything. In essence you flight isn't cheap because they charge for things like bag check-ins, drinks and food in-flight, and more. But they earn additional revenue through advertising on the seats and deals with hotels and rental car companies that give them a cut for referrals. That revenue is esentially subsidizing your flight.

In all your flight isn't truly free, but it's pretty damn cheap. If you're not looking for frills, it's certainly worthwile.