The argument of public/private isn't really the fundamental, as "The Grand Wazoo" has suggested in his earlier post. Ownership of the actual bus business is the current distraction from actually sorting out the roads so that they provide an environment in which buses can flourish for whoever owns them.
Franchising won't make it any better - in fact, putting more cost into the public purse really doesn't seem to be the way forwards at the moment. I'd like to retire sometime, and not die whilst at work, and given the amount of money spent recently, we'll all be paying for it for many years to come.
So, let's go back to if the current system is broken? In places it's perhaps suffering, but in others it clearly isn't. Innovative operators, working with innovative partners in councils/local authorities can see to make buses an attractive place to be. The operator should provide the product (a la Transdev etc), the Council provides the road space to make the bus more attractive than the car.
You will always get commercial businesses focussing on areas where they can make money - that's a fact, and if they're doing so, why would you want to take the risk public? We've all now got the revenue risk on the railways for running empty trains around, and taking that on bus wouldn't help return them to what people see as their former glories - conveniently forgetting that at that time, they also didn't have such a car-centric society as we have now.
So, you want good commercial operators to drive innovation, and good local authority partners to drive road improvements etc that will increase customer volumes. De-regulation isn't broken - the model just needs working on slightly to get the best of both worlds, and as long as Councils keep shouting about "franchising" or "public ownership", they aren't solving the bigger problem of the car - just distracting from it.
Very beautifully put and there's definitely been a ton of council shouts about public hands for buses lately although cuts have driven that. Think there's a fear in the councils to do anything incase it annoys car users so I don't see much change soon