German Wings will always be a small player. With the name German Wings all that you can hope for is routes from germany to XXX, never Paris to Barcelona or say French domestics. Which Frenchman would travel with German Wings on French domestics say?
60 years is not a long time in history! Like it or not the "German" in their name will let them down!
Whereas "easyJet" does not have a regional name so people aren't put off by the name (unless they've seen the tv series). Therefore eJ can build up critical mass in other markets to subsidise a fight with German Wings.
However I think LH have a share in GW as it is/was part of Eurowings which were owned by LH. Be interesting to see if LH start subsidising them.
I remember when "go" was operating STN-MUC Lufthansa contracted in bmi's A321 to compete at rock bottom prices on the STN-MUC route. Great for consumers but not for the company.