At some point there is going to be a monetization of the domestic F cabin by the US3. If not this year not too far down the road. There's too much pressure from Wall Street to ever increase revenues and there are already airlines that in fact have no complimentary upgrade system. You can't get Mint for free. I think such a move would only fail if one of the US3 didn't go along but let's face it none of them have bucked the trend.
As far as "loyalty." I remember when the idea of status based upon dollar spend not just miles flown by the US3 was being discussed. Some of the newer airlines like VX at the time had already adopted that model. So many on FT said it would kill "loyalty" if the airlines went ahead. Well they did and loyalty stayed. If complimentary domestic upgrades went away FF loyalty would remain. Some of it forced due to hub dominance, some of it just because FF elite programs will still provide a level of benefits-free checked bags, free MCE (for certain levels), priority check in, better handling in irregular ops, etc.