You're not wrong on their poor employee experience, but there's very little theater involved - there's good reason to protect their IP. Any firm that invests multi-millions in original design will want to protect their property from theft. Semiconductors were mentioned, but also think about someone like Pixar.
The thing is, what's stopping employees from uploading files to a server? The physical devices are a fraction of a fraction of IP theft. Hence the term "theatre".
Hopefully a firewall.
A business like this is likely to have a WebSense network appliance, and/or policy enforcement software on the desktops.