If Serco lost the franchise it still wouldn't change much other than the financial situation. Many people I have spoken to both staff and passengers alike feel that there is a general trend of 'run before you can walk' with the service. In other words, the basics have been ignored, which is making passengers less inclined to use the service. By basics, I'm talking about trivial matters like the interior designs of the Mk5s, the working conditions, the culture in which staff onboard are now expected to act in, etc etc. Their words, not mine - though coincidently our views aren't too disimilar. It goes deeper than financials, it goes right to the heart of what the service used to be about, and how decripit this has since become. Put it this way, the old sleeper was still prone to the same attrocious delays and mishaps, yet the same passengers kept coming back one way or another. The cause to the change in habit as you mention perhaps goes beyond simply punctuality.
The rebranding of the sleeper towards a more tourist based market has backfired spectacularly. If not backfired, then grossly understimating of the tourism market in relation to its patronage. If anything Serco are just as much victims, as that vision was peddled first and formost by Transport Scotland and the Scottish Government, without any real thought for their then existing market of general commuters - of which they have since alienated all but completely. I won't blame them for trying to put emphasis on that market, but the way in which they have done so makes the whole rebranding seem like an experiment gone wrong. They have the chance in the next few years to cut the franchise, get back to the drawing board, and really think about where they want it to go. Because the way it is now on all levels, simply isn't working. Perhaps I'm old school in looking at it through the perspective of culture of the old and new service (despite being in my early 20s), however I can't be that wrong given this is becoming the concensus among those who regularly used the service both as passengers and staff. If it is going to work in the way that they hoped, it will take much much longer to establish a) the culture and b) the market they want to operate in.