Those two items are not mutually exclusive.

I suspect - and have stated here before - the biggest eroder of EUA's was DL simplifares move. Doing so not only initiated the Z (and now R) fares but also dropped the Y-UPs in many markets. (Although I will admit to the latter charge the LCCs have done their fare share too of driving down prices.)

I think the majority of Plat travelers are profitable -- just like the majority of full Y or R/Z customers.

I also think it's a win-win(-win..for anyone who keeps up with the office ) for CO to offer a domestic F product people will pay for.

However as it has been hashed out time and time again here - CO needs a way to increase F inventory on key routes. Arguably they seem to be trying to do this (2+ seats in 738's & 739's, more 739's for transcons) yet still the problem of not being able to meet paid demand exists.

Obviously certain days, flights and times stand a good chance of always selling out but still I think there are various moves which CO can begin to implement now to relive the F cabin crunch.

At the top of this list is increasing the mid-lav 738 fleet to help augment high F demand routes. If putting in a new lav into the 738 makes this cost prohibitive than remove a row of Y and add a row of F...but this is another thread within itself and does not focus on the topic for which this thread was created.

Back on topic: I would assume Y-UPs - like R fares - have become more popular as the once high price barrier has fallen considerably and thus more F inventory is being sold albeit at cheaper prices. Hence upgrades become harder - especially in a market where people will be predisposed to buying F/YUPs to begin with (such as EWR) netting anemic EUA rates.