I understand some managerial shenanigans in this scenario where you might view Team A of 1 as being something of a McGyver solution. I'd expect the natural step though if you have someone solving a problem in with 10% of the staff, 1% of the code and 2x the performance would be to shift some resources to them to productionize/productize/whateverize the thing.

While in the open market the best or first product doesn't always win, it's at least a competition of cost/value/quality/marketing/timing.

Internal competition is largely personalities and politics, with a predictable winner before the timer starts. In the long run if there is enough management turnover the rational solution can win, but you are basically playing chicken with senior management to see who quits first!