Exactly. As a mostly business traveler, I'd be delighted if there were no options other than business class service with champagne and caviar for dinner. (OK, I generally prefer beer and I'm not a huge caviar fan but the principle still applies.)

But most people traveling for personal reasons (and many traveling on business) choose or are required to choose the rock bottom price which results in not only stripped down amenities but also a general focus on cutting operational costs to the bone.

Furthermore, the big legacy carriers are still generally more attractive to regular business travelers because of their loyalty programs which insulate them from at least some of the worst aspects brought on by competition on price. (In that they get a somewhat better class of service without paying for it directly.)