Southwest is THE low cost airline. That's their secret sauce. Virgin is being "the best way to fly" or whatever. Southwest cares about nothing else.
They don't do assigned seating because they found that without assigned seats they were able to fill the planes faster, meaning less time at the gate meaning more time in the air, meaning more legs in a day, which makes them more financially efficient.
Back in the day they didn't pay travel agents the %15, and sold direct instead, etc.
Southwest treats their employees very well, and while there is occasionaly a union squabble of some sort or another, they have much less of a problem than other airlines. Why? Becuase its' cheaper to treat your employees well. Seriously.
This also means that customers are happier because employees are happier.
The attitude of a southwest steward compared to the big three (Delta, United, Continental) is radically different. The big three employees often give me attitude and seem to think that dealing with me is some sort of an imposition-- and so I am loathe to fly on them (it only takes a couple incidents.)
Awhile back southwest merged with a regional carrier (frontier? no, something else) but that carrier was known for a gimick where the employees would sing on landing or do the safety lecture in rhyme and the pilots would tell jokes. Southwest didn't change this practice, and it became optional and now it's not unusual to fly on SWA and have a landing limmerick.
Their ticker symbol is LUV.
Southwest flies into Midland instead of DFW. They fly into the older city airports, not the big fancy new airports. Why? Gate fees are a huge operating cost (basically a license for the local government to extort as much as they can from the airlines for the "priviledge" of providing air travel that boosts the cities tax revenues anyway) ... but soutwest doesn't pay to be in the glamorous locations. You may walk further to your gate and your airport may not be as nice, but it saves them, and -- here's the important thing-- they pass that savings along.
Southwest doesn't serve hot meals. They give you a bag of peanuts labeled "Frills".
They are one of those unique companies like Apple and Zappos and Crutchfield that really put the customer first, and were willing to go against convention to do it.
Nothing against Virgin- I think they're trying to do the same thing and taking the high end of the market, and I'd love to fly Virgin if they had ever had an option on a route I was going (they haven't yet, so I haven't flown Virgin yet.)
But Southwest filters everything they do thru their mantra. They are THE low cost airline. Does whatever help that? No? Then don't do it.
Southwest is a result of focus, and that is a useful lesson for every startup.
I hear the book written by Herb Kehler (sp?) is well worth reading (I think it's called "Nuts" or something like that.)