It is not a obvious insight to grasp since airlines take a strategy that makes them the most money and passengers are cost sensitive. Wasn't this the driving force behind the hum and spoke model?
No, the range of small jets (which were constrained by relatively unreliable, inefficient engines) was. Small jets can safely go further today than they could before. Boeing saw this. To be fair, Airbus also saw this. Political factors, similar to those behind NASA’s Space Shuttle debacle, constrained them to making a giant ass plane.
To be fair, Airbus actually owned the big twin market until the 767 and 757 came out. Then those planes (as well as Airbus's own planes) fragmented transatlantic flying. Then they lost their way when they focused on the A380 - but the engines that enabled the 787 were not yet out.
That channel also has alot of very interesting content on the economics of air travel (e.g., seating classes, how tickets are priced, etc).
More detail: the Dreamliner is 20% more efficient than previous generation planes. This allowed airlines to "break" the major hubs into many quicker/easier direct flights at a price that passengers are willing to pay. Boeing bet increasing value in this manner was superior than Airbus's bet to simply make hubs cheaper to operate.
Especially among business travelers. Many business travelers may still shop on price up to a point but they'll tend to do so given that the flights have the same number of stops.
Furthermore, some international and national air travel networks are in fact organized in a hub and spoke pattern, particularly trans-oceanic flights where demand is high and cost is the main competitive advantage, including business travel.
It's easy to claim now that the choice that was made a couple of decades ago was the right or wrong one, just like it's very easy to pick yesterday's lottery numbers, but if the world economy didn't tanked and if Airbus's projects weren't with so many delays then I really doubt Boeing's bet would be so right.
It can be harder than it appears. Never forget the poor Chinese guy who noticed that the winning lottery numbers were announced before the close of ticket sales, and got thrown in jail for his pains.
Problem with the spoke and hub model is passengers not only decide on whether to fly based on price but on psychological stress[1]. When that gets too high they won't fly no matter what the price is. Airlines probably make more money if they _all_ charge more for lower stress flights.
[1] More stress means business travelers need more down time after flights, which lowers productivity and moral. Long stressful flights impacts the quality of vacation travel.