Keep in mind also that in a regulated environment, the only way to compete at all was in the passenger experience. If TWA, United, Braniff and Eastern all operated the same route, and it cost the same, the only way to differentiate themselves was in the pax ex. CAB rules limiting routes and entry and controlling prices meant that airlines were limited to competing only on food, cabin crew quality, and frequency. It's also why loyalty programs came about - it was a reason for business travelers (most back then) to choose United or AA instead of TWA or Eastern - the marketing was the only reason someone would go out of their way to fly with a particular airline. Even before those airlines went out of business, you saw a change in the way they did things pretty much immediately after 1978 and the Airline Deregulation Act - before average load factors were in the 50% range. After, with the freedom to maximize capacity, gone were the onboard piano bars, and came smaller seats.
Also, the CAB fixed fares to distance - so it made sense for the airlines to serve smaller cities with nonstop service, if it meant they could be the only ones serving that market. The hub and spoke model is really a post-deregulation innovation.
Plus, all airlines were, relatively speaking, tiny back then - they just had an outsized presence in our minds, due to omnipresent marketing. In 1978, it's last profitable year, Braniff had a grand total of 92 airplanes. 77 727s, 14 DC8s, and a single 747. That's fewer than Allegiant, which in 2024 has 127 jets. Nationally, all together there were only 2030 of what we would today consider "mainline jets" flying around the US, including some 352 DC9s, which often filled similar roles as today's regional aircraft, carrying a total of 226 Billion revenue passenger seat miles. In 2023, AA alone has a fleet of 965 aircraft with an additional 556 RJs flying under the American Eagle branding for a total of 1521 planes, and flew nearly 232 billion revenue seat miles. In short, today AA alone basically represents the entire sum total of American air travel in 1978.