chinapattern
You're right, but the Merseyside and Greater Manchester conurbations are combined, much larger than the West Midlands, even if you define the West Midlands as the old metropolitan county, that encompassed Coventry to the south (barely an hour from Luton) and Wolverhampton to the northwest (barely an hour from Manchester). Added to that there are some sad souls that will brave the M62 to get to Manchester from Leeds and Bradford.
None of this make the case for BHX not existing, but it does make carriers in the "pile it high and sell it cheap" market think twice before joining an already comparatively crowded market in Birmingham.
BHX's big scoring points are the NEC and ICC, which draw business travellers to the city, and as a result makes the airport attractive for legacy carriers, and TK's commitment to BHX testifies to that, along with existing ccarriers, such as LH, EK, KL etc etc.