Four years and change later the central thesis that developers will abandon Apple en masse because the App Store is a great crime against programmers rings hollow. iOS is still the first target for many developers and for those where it isn't, they're more likely following the enormous Android userbase most of which Apple doesn't even compete for. I'm sure it has cost them some developers but the short list of big time Android first apps tells you the score.
At the end of the day hot dog vendors sell hot dogs in highly regulated NYC because people in NYC buy hot dogs. Companies sell their goods to Wal-Mart and Neiman Marcus instead of at the flea market because that's what keeps the lights on. Small publishers work with Amazon despite horrible terms because it puts steak on the dinner table.
One thing this article reminds us of it that pg has the not uncommon HN blind spot for Google who he claims has "remained true to their founding principles". I guess stabbing a close partner in the back by releasing a clone of their flagship product is not being evil. I wonder if he's also a fan of the Samwer brothers?