37signals rebrands as Basecamp and will focus solely on that product

Jason Fried, the CEO and founder of 37signals, announced today that the company is rebranding under the name of its best known product, Basecamp, and will be redirecting all the company’s energies into that product going forward. (Note, however, that the announcement was posted at 37signals.com, and Basecamp.com is still a landing page for the product of the same name.)
In the post describing this move, Fried states,

Fifteen years into it, we’re proud of the work we’ve done and the business we’ve built. And business has never been better.
However, because we’ve released so many products over the years, we’ve become a bit scattered, a bit diluted. Nobody does their best work when they’re spread too thin. We certainly don’t. We do our best work when we’re all focused on one thing.

I have often wondered why the-company-formerly-known-as-37signals built the functionality of its other products — like the CRM tool Highrise, or the almost-but-not-quite-Basecamp-competitor Backpack, or even the Campfire chat tool — outside of Basecamp, instead of as additions to the core product.
I’ve been arguing with Fried about the company’s product design flaws since 2004 (see Basecamp and The Federation of WorkStowe Boyd and Jason Fried: Where Should Basecamp Focus its Resources?, Campfire: Group Chat for Businesses, Jason Fired on CampfireBasecamp Design Flaw #743: File Versioning Is BackwardsBasecamp Messiness, and numerous others), and the arguments generally follow this form:

Stowe Boyd: Product XYZ from 37signals has this odd design flaw, and I don’t understand why XYZ isn’t a feature set of Basecamp, anyway.
Jason Fried: Stowe, we have gazillions of happy customers using XYZ: you must be an outlier. We are going to run XYZ and our other products like we do Basecamp, as separate business lines, and we don’t need to consolidate them.
Stowe Boyd: I bet that sooner or  later you will get around to fixing that bug in XYZ, and or build XYZ functionality into Basecamp.

Now that company will be selling off, or spinning out these other solutions, or putting them into barebones maintenance mode, perhaps they will make Basecamp into a more useful tool, based on a new take on what today’s workforce needs.
They already ‘retired’ Backpack, and lifted some of its design ideas into the ‘new’ Basecamp. They also retired Ta-da list, a task manager, and Writeboard.com. They also retired their product blog, one of the stranger moves they’ve made, supposedly to make it easier to communicate with their customers. And in the last sentences of the post, Fried states that they are now planning to add new ideas to Basecamp:

… we’re working on a variety of other tools and ideas that’ll expand Basecamp in all new ways. We’ve also begun R&Ding entirely new, future versions of Basecamp …

The final question I ask is this: if people do their best work when they are focused on one thing — which Jason uses as the fulcrum for the announcement about refocusing the company back on Basecamp exclusively — then why did they start so many side projects for so many years? Either a/ he and the others didn’t think that was dumb before, and they have squandered years of effort on subpar tools that never really justified the effort or our attention, or b/ they have only recently come to the realization that they should focus on a single thing, and what they had been doing was dumb.
Either way, it was a dumb way to go.