well managed company? What he described is very nearly rent seeking. If a company is never innovating and always simply copying what everyone else does then that means that, 1) they will always be cheaper than their competitors and 2) if they ever completely win their market they will be stuck with the last iteration because they can't afford to innovate.

People like to say a race for the bottom is good for consumers but it isn't. A race for the bottom is only good for people playing arbitrage games who know to get out before the bottom is reached.