How can Jet2 batter easyjet in an area they effectively didn't compete in? It was certainly an unexploited revenue stream (so you could argue they were losing money that way) but it certainly wasn't adversely effecting the airline. Remember that when EZY holidays was launched the airline was, as it is today, growing load factors, revenue and yield.
Like I said, Jet2 holidays is becoming more and more competitive to the big two IT operators than it is to Easyjet to the extent where jet2 Holidays is a different model.