[vmateixeira]

Thanks for the explanation. I had the wrong idea that it could be due to, for example, if A->B belonged to a different provider than B->C, providers not reaching an agreement on what % to take each, for the journey from A->C - hence increasing the overall cost for covering demands from both.

[Closi]

No problem! You are right that it’s silly though, you shouldn’t have to split your ticket to get the lowest cost.

In real terms the main reason is to protect commuters and capacity - as a theoretical made-up example during the bid process they might be aware that lots of people travel from Milton Keynes to London so the council wants to put a cap on increases for that route. They might also still have lots of capacity on the route from Banbury to Milton Keynes on a morning, so that is priced much lower than Banbury to London. So if you go Banbury -> Milton Keynes you might get a “discount” for not a lot of people using the line, and travelling from Milton Keynes -> London you get the rate that’s protected for commuters, but if you go between Banbury and London then part of the route is already at capacity and there is less discount on the rate.

[gsnedders]

No, there's long been a centralised system to attribute the costs to different companies (IIRC, the system is ultimately the descendant of what the British Rail regions and later sectors used to split fare revenue between them).

There's no negotiations between the companies here, though they could ask the regulator (the ORR) to intervene if they believed the algorithm gave unfair results.