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Based on experience living in Amsterdam, I think this is just controlled by driver line-of-sight. There are passing places at each canal bridge on this street, so I think the rule goes 'if there is a tram visible at the next bridge, let it go first'. The throughput doesn't seem smooth enough for...

There are no trains apart from XC from Southampton and Bournemouth to Reading, and SWR don't have enough diesel stock to cover this route. So this just shifts the problem from XC to SWR, who are even less able to cope with it.