I wish Go well from Newcastle. Despite the 'noddy guide to airline economics' given above, the problem with newcastle lies on many levels. Not least of these is the good fast rail service from central Newcastle to Central London in around three hours (one train every hour). So ,although initially, their may be takers for ultra cheap fares, whether the demand can be sustained is another matter. Newcastle railway station is EXTREMELY well connected to the North East and suburbs of Newcastle (via the Metro)(unlike most of UK railways). I am no fan of railways, but the service between Newcastle and London is very very good.
But I'm sure Go have already thought this through. Good luck to them. Newcastle to other European countries would be a different matter altogether.
Just a final point, I agree with an earlier posting above, that not everyone will want to travel with budget airlines. It is a different market sector, which overlaps with some 'premium travellers' and railways. I repeat once more, the price difference is not due to food or drinks (an urban myth), and budget airlines are not always cheaper - check all prices before booking, and you will be astonished.