I agree, to an extent, but it's also a balance. Mobile phones are VERY expensive... you have to pay a fat payment up front plus accept a two (or in Canada, THREE) year contract.
As a result, people want to know the device that they're purchasing is going to last for at least the two years they own it, with regular updates that keep it reasonably current. They don't want to be stuck with something that, in 12 months' time, is completely obsolete or no longer supported. Motorola WILL piss off a big base of influential "geek" users with this move, which will result in poorer sales across the board as non-techies hear about their geeky friends' experiences with Moto.
My Palm Pre 2 was a great device "in context at the moment" that it was released, but was a poor purchase "on contract" (fortunately, I bought it OFF contract to have a webOS device). Had I bought it on a two year contract on Verizon last year, I'd be facing having to make it last to 2013 without any real security updates and a whole host of bugs that have emerged as Microsoft has released Exchange updates and Skype has changed its protocol. And that would be bad.
When you buy a smartphone, you buy a present and a future... not just a present. All the OEMs have to work to show users that their decision is a good one with an experience that will continue to deliver over that 24/36 month contract.