Possibly on some routes, I regularly travel from Northumberland to poole using Flybe. Bearing in mind air fares are often fairly close in terms of price when booking for business IE very short notice, I wouldn’t consider rail over flying. It’s a cause of 7hrs plus vs an hour flight.
But that’s my point. Air fares on these small markets with decent competition had to be close to the competition. For Northumberland to Poole there are, what, three flights a day Newcastle to Southampton? Compared to two trains an hour by train changing in London (with a sub 5 hour journey time to Southampton). I would guess that depending on start / finish points, door to door would be about 3 hours longer by train, but the latter would be more comfortable, easier to work, sleep, etc. If you didn’t want to get up early enough for the early flight, but didn’t want to wait for the late afternoon flight, or wanted some flexibility, train would win every time. Hence for many people the train is the option, and the airline has to price accordingly.