> the simple option is to cut lines serving small and rural communities
We don’t see this in practice to though. Three examples:
1. In the airline industry big airlines don’t go everywhere for this reasons but small local airlines fill the gap due to market opportunity.
2. Changes in technology enable big companies to operate more efficiently. See starlink.
3. Big companies know that ubiquity is important for their brand. In practice Amazon will deliver packages across the US.
The airline industry gets huge subsidies in most countries to operate more rural/less profitable routes. Most of the passenger airports in the US for instance would not be viable without subsidies (most flights go to a few profitable hubs, but the long tail or airports forms the majority by count).
Amazon delivers everywhere because USPS subsidizes package delivery to unprofitable areas. You don’t get next day prime except in a relatively small proportion of the country (by area).
>In the airline industry big airlines don’t go everywhere for this reasons but small local airlines fill the gap due to market opportunity.
You’re not wrong, but small and rural airports would not be able to maintain even these routes without EAS (essential air services) subsidies
You cut off the OP's sentence of that being examples for "Rail companies" and then added your own examples. Please be better at comprehesion and editing comments
"In practice Amazon will deliver packages across the US." You know they use the Postal Service for last miles often? And the Postal Service is required by law to service far-flung places. So Amazon is only, in practice, delivering packages to those places due to USPS.
Meanwhile in Britain in the 1960s, this cost-cutting closure of local rail lines did happen: https://en.wikipedia.org/wiki/Beeching_cuts ... at a time when the trains and rail infrastructure had been publicly owned for about 15 years already. It doesn't dispel the incentive.