Domestic connectivity could be ring fenced with x% of new slots allocated to new unserved destinations. Remember how well INV-LHR did for Dan Air even though it was a stand alone? So INV, JER, GCI, IOM could all support a LHR link but at the cost of some LGW/STN connections. It would allow connectivity to the world without the troop around the M25. It can be done, there just needs a pricing policy to support it as part of the agreement to expand LHR.
Yes, LGW and STN would lose some links.
I doubt LPL, BHX or NQY could make the case but it depends how supportive any government wants to be outside the craziness of the London bubble.
BHX-LHR was a BD route back in the day, probably not coming back. As for the other two, Heathrow Airport Ltd. appear to believe so. If there is a PSO for NQY at that time, imagine that would shift to LHR, ditto DND.
That unless you have the appropriate level of scale to feed and de-feed the hub, it doesn't work. Little Red were attracting point to point passengers at relatively low yield and competing in part with their own point to point service on the railway
VS failed to do what BD had done: a deal with the star Alliance for connections.
I think the Irish gentleman at the top table of IAG rather thinks poorly of franchising- He closed down those on home turf some years ago.
Things change, collaboration doesn't have to be franchising.
Fundamentally this is probably the real sticking point for many of the neo-liberal economists in the right of the Tory party - Specifically such investment might be seen as a subsidy toward BA/IAG and not true market lead competition.
More likely to be interfering EU busy-bodies poking their unwanted noses in.
Regretably we're unlikely to have left the EU if and when a third LHR rwy opens.
Both are unlikely in most of our lifetimes.