Maybe not in terms of losing customers completely (although I suspect even that happens), but in fact the whole surge-pricing thing is based on losing customers, who will either try something else, or try later when prices are at a more normal level
But the surge-pricing model is predicated on the fact that some people are largely insensitive to price, and will pay a significant premium to get a car immediately when those paying the normal fares are struggling to get one.
So, yes, it does work to a degree, but it's a relatively small segment of the overall market.
But that's why it wouldn't work so well across the board with the likes of a £9 flag on T2
It would all get very messy, and a recipe for confusion and conflict.
And even assuming all the drivers charged a £9 minimum, there's bound to be leakage of customers, as was evidenced by the other side of the Uber model in the form of cheaper prices, although to a degree that's not such a selling point now.
And even if there wasn't any leakage, the other side of the coin is that if taxi drivers could indeed double their takings overnight, that would eventually mean more drivers in the trade, decreasing profits for individual drivers
