Yep. Hardly a surprise, though. With LHR-MAD down to one frequency, the writing was on the wall.
Not good at all that there will not be a single direct *A flight between two major European capitals. From the UK, the Iberian peninsula is an OW or no frills preserve (OK. There is still the LHR-PMI flight, but that connects to nothing).
Presumably Spanair have no plans to takeover the route?
And why on earth does bmibaby want to compete head to head with Easyjet? Not to mention that IB and BA often have no-frills level fares to Spanish destinations.