I work in giving investment advice and the key rule there is diversification, don't put all your eggs in one basket.
Their cost base was too high and the competition was nimble and sure footed. Ergo the regions were left to easyJet, Ryanair and Jet2, the new competition who flew more people than BA ever did. BA aren't killing LGW, they just can't make it pay in the current climate and massive competition from easyJet. If BA were to invest heavily in Gatwick they'd lose even more than they are due to their cost base. How do you fix that? I admit LGW is more competitive than LHR due to new working practices but you are comparing 24 B737-400s built in the early 1990s with new build A319s and the flexibility such a massive modern fleet brings.
I might point out that BA made record profits last year..... The legacy carriers need to make money with a business model that delivers profits, for BA that has ALWAYS been operating at LHR. They've barely scratched a pittance outside of their main base and in lean times have lost millions.
Investment isn't aviation and in this particular case, the analogy is weak. People still get upset GO was sold, but it was eating away at BA's own margins at LHR and BA was competing with itself!