If LCY could offer increased distances through a runway extension there might be something in what you say, but they cannot.
LCY cannot provide a Runway Strip of sufficient width to meet the CAP 168 requirements for greater TODAs and ASDAs than approximately it has at present.
SEN on the other hand, with a proposed runway of 1850m, would offer new opportunities for LCY's owners without diluting its own current market. Leisure routes from the likes of Flybe and the bizjet FBO market are just two areas where expansion at SEN would have no detrimental effect on LCY.