Goat,
I welcome your contrary view. A primary object of all business is to make money and if you only have to cover your direct costs (labour. fuel. ANC, etc), by owning the aircraft, buildings, other systems etc, you will be able to compete better and make more money than having to pay both the fixed costs (monthly leasing rent on airframes and engines - regardless of the utilisation level, buildings, other systems, etc) AND the direct costs.
This is further complicated when you also have to pay passenger royaties to a third party. Many of the failed third party regionals in the US leased their aircraft and came unstuck when the code-share partner refused to pay sufficient and necessary royalty tax increases during successive re-negotiations.
If Virgin thought there was real money to be easily made from regional flying do you think they would have entered into such code-sharing arrangement? No, they would be doing it themselves in order to maximise profit.
Virgin is going about it this way because they know there are real risks and they want a buffer to mitigate and direct those risks away from their weak core business.
The Oracle