Pretty much exactly what my TUI pal was explaining yesterday. He also said they moved away from full charters - his part of TUI ideally wanted to charter whole planes as they could then fill them, but Monarch only wanted to deal with them by selling seats, and they were often not the best price.
Travelled back from Faro yesterday, there were a couple of Monarch flights on the board that had been picked up by another airline (code EB) and appeared to be running to schedule. One of the guys I was travelling with is an MD at TUI...gave some interesting insight on how difficult/choosy...