It's amazing how many don't understand capitalism and the free markets. The cost of providing a service has very little to do with what is charged for that service, the marketplace determines that price. United charges what they can get for their tickets, if they can charge more they pocket the increase and their earnings go up, if they can't cover expenses with what they're charging then they go bankrupt. They can't just raise fares, if they do then the other airlines will undercut them and their seats will fly empty, generating zero income. United can't just pass the cost on to the consumer, they're not a monopoly. If the airline industry was still regulated then they could run to the government like an insurance company, whine that their costs went up ask to raise prices to cover it. They're not regulated any more though. They most certainly will "eat it" and the amount they paid Dao is paltry compared to the loss of business they've experienced so far. They (wisely) decided to pay him off to get it out of the news as quickly as possible so they can get their business back.
They're still going to lose a bunch of money out of the deal, but the settlement amount is small peanuts compared to the rest. They're just trying to stop the bleeding right now.
