Losing that great competitive browser because of pursuing even higher goals and ending up with an even more silo'd, broken up internet is an even less desirable end state and one that is much more likely to materialize by acting like this.
Both, actually.
But anyway, you're entitled to your opinion.
Why do you say this? Because this is exactly what I expect Mozilla/Firefox to do.
IE, Chrome and Opera all use the Chromium engine. Safari is locked into the Apple ecosystem. And as such, it’s imperative Firefox fights this battle, with all the resources and community support they can get. Otherwise we do end up with a Chromium-only silo very quickly.