Instead of a weekly bus pass people could buy a ( for example ) zone
2/3 weekly Tube travelcard for almost the same price; this could be
used on the Tube in those zones and on every London bus.

Yep - but I bet there are still plenty of people who need buses to get
to and from work and to whom the extra £3.20 a week would be
significant.
--
Robin
reply to address is (meant to be) valid