They probably know what's wrong with it...
...but in a real life company it doesn't matter. What only matters is the opinion of some top ranking internal personal.
I mean imagine Microsoft would bring out something closer to what people wanted. Let's say a surface tablet which is just a laptop in tablet form, without any limitation on what operating system you could run on. People would either want to run Windows 7, some Linux or Android on them. None of those options is particularly attractive to Microsoft. Plus they probably wouldn't be able to shoehorn their app-store, which means a hope for constant stream of commissions, into it.
In real life companies it is often not possible to do what's sensible.
Biting the hand that feeds IT
