Hence the first problem. I'm not debating the cost difference between prop and jet. My argument is that pax flying SYD-MEL expect a jet. I've heard the argument that a turbo prop may be just as quick as a jet, but I personally don't subscribe to that theory. For me, given the choice of a jet or prop, I'd much prefer a jet.
Let's hope you're right. I actually like greater competition provided it doesn't drawn down on our niceties and safety. I tend to think not only does this concept need to be competitive, it most likely needs to be cheaper to draw the crowds. We've all seen what has happened with that in the past, QF definitely (and most likely VA) will slash their fares until the competition dies (unless they believe the competition will die of it's own accord). The only digression to this scenario will be if the new comer has a niche (the one that comes to mind for me is an all J experience, which has been pointed out was trialed and failed). For corporate travelers, it's not really about the price, it's about the facilities on offer. Although you tend to believe carrying your own luggage to plane (sometimes in the rain) is what people will see as a good thing, I believe the corporate traveler is conditioned to their luggage arriving on a carousel and the walk to the plane is via an aerobridge.
That conversation you mentioned may also include the words "and make sure it's not that mob leaving Bankstown as last time I didn't make it home that night to my family and it cost me $400 for a MEL hotel for the night because they couldn't take off due to ... "