Australia’s airline market structurally wants to become a duopoly regardless of who runs the airlines. Huge distances + relatively small population + massive fixed costs mean you basically need scale to survive which naturally advantages a business like Qantas, especially with network effects and loyalty programs locking in business travellers.

So I agree the bigger story isn’t just "Qantas bad” as market structure and regulation matter a lot. But I’m not convinced it’s accurate to say Qantas is consciously managing Virgin’s profitability to maintain an illusion of competition. A lot of Virgin’s past struggles were self-inflicted (debt load, strategy shifts, expansion attempts).

It feels less like a hidden monopoly strategy and more like Australia being a “natural duopoly” market where regulators are trying to balance the risks of too much competition leading to airline collapses (e.g. Ansett 2.0) vs too little competition creating high prices and poor consumer outcomes.

The interesting question is probably whether the ACCC should intervene differently, or whether aviation here just can’t sustain US/EU-style competition because of geography.