Lots of interesting comment since this post, of course.
But, it's a bad omen for the attitude of the people now operating (my) long-distance services.
Either they didn't understand that this was something Virgin had provided for years, that their new "customers" would expect to see under the new management, and were genuinely surprised to find this out.
Which I don't believe.
Or they had to come up with some sort of Web booking process and, either to save money or just lack of competence, decided that a seat booking facility wasn't necessary. Which they then seemed to bluff about once people started complaining. If they'd held up their hands at the start and apologised and said that it was something under development, that wouldn't have been so bad, but the impression I get is that their initial response was to say that it was an unnecessary facility (in their opinion). Well, I don't really think much of their opinions if so!
Virgin had an unjustly good reputation (in my opinion) for running trains but seemed to have a good approach to customer service, and based on what I've heard so far I'm unsure about the replacement operator's customer service approach.