WHBM,Strange logic you use
The Republic of Ireland may only have just shy of 5 million inhabitants but its largest airport DUB handles a lot more than 5 million passengers a year indeed enough I'd wager to 'sustain' more than one large based carrier.
So what happens in the Marathon? One winner and everyone else just fades away into the shadows, disappears never to be seen again? I don't think so somehow. There is a second and third place medal awarded and then there are all those others who weren't 'placed' but will be back next year to try for gold.
It could be argued that Competition at its very best is a very fluid state one in which there are winners, near winners, losers and absolute losers. So this year one particular airline wins Gold and its closest competitor 'wins' silver another 'wins' bronze and the 'also rans' get a tin medal for finishing but then there will be a few absolute losers who won't finish and won't be back next year.
Aer Lingus has changed considerably over the past few years much to the dissatifaction of many Irish people who yearn for the old 'flag carrier' days they have changed their business model to become more competitive and today they do compete with Ryaniar and the many other carriers that operate services to and from the ROI. Some may argue they're not winning but they are still in the race.
But seriously how can you apply your Marathon analogy to the aviation business (or any business for that matter)? there are so many variables involved, price, comfort, service, availabilty, timing, additional charges and the list goes on. Competition is a many facated thing it isn't I believe as black and white or absolute as you may suggest.
Perception is a personal thing
I am not Irish and I don't work for either Aer Lingus or Ryanair.