Tonyq - I honesty don't know how close to the tipping pint things on IOM are for BE. It could well be that the routes are still profitable or at least paying their way. But in the context of the airline more generally making losses and looking to cut costs wherever possible, I'd say the IOM routes are quite vulnerable right now. Flybe are not in a position to maintain service on unprofitable routes in the hope that things will pick up soon.
However, another part of my thinks that BE may play it strategically and take losses on IOM in the hope that EZY will back off first and the revenue will start flowing back in again. If BE show signs of rolling over when under pressure, it may give a big green light to EZY to move in on other lucrative routes that so far have been off EZY's radar.
Truth is no one knows other than those at the top of the commercial department in BE. I hope they don't give in as there are a lot of hard working and loyal staff on the IOM who would be devastated to find themselves without a job.
On a sentimemtal note, a good number of the crew based at IOM with BE have many years of continuous service going back to Manx Airlines days. They've trawled those routes for decades serving the locals and its sad that those very locals they take pleasure in serving are so quick to abandon them for the orange bus.