I wonder if relaxation of "use it or lose it" rules about slots have helped influence their decision. I was always under the impression that a certain number of slots were restricted to domestic-only, hence the ludicrous sight of Flybe running a Dash 8 into Heathrow. If that starts to fall away, or if you get to keep your slot even if you don't use it, then why run domestic?
They were the so-called ‘remediation’ slots, which were indeed restricted to domestic routes for a period of time. That was (allegedly) Virgin’s interest in flybe, even after their own domestic belly flop with little red.
The shorthaul changes in the last few years that BA has seen are things like double daily Ibizas with Club Europe back to Row 12; one ways to Nice for £742 in Economy; Santorinis, Zakynthos, Genevas, Zurichs and Madrids full and standing.
These twist quite significantly the economics of connecting networks, so while (say) a Leeds Heathrow route with a high percentage of interline traffic has a fundamentally different economic profile than (say) a Leeds to Gatwick easyJet point to point model, if the Leeds Heathrow operator identifies better commercial opportunities with the capital asset and time, they’ll shift to it.