The nameless exec said that to me the last time we met, roughly a week before they were pushed out; precisely for that belief. (And at first I suspected you were the exec.)

And yes, the product that I worked on did have a ~600 ticket deep backlog, and plowing through it wouldn't have made the product better. At the time, the product was in a steady growth phase, where addressing customer pain points was just as important as building features.

Where the exec goofed (by jumping on the mobile bandwagon) was misunderstanding disruption, market needs, and how mobile would effect us. Ultimately, we were a "bolt-on" accessory, and the incumbents in our industry slowly pushed us out until our niche, (which had nothing to do with mobile) was our core differentiating feature.

Basically, the issue was allocation of resources. Too much were put into mobile, not enough into building features where we could compete against the products we were "bolting on to," and not enough into addressing customer pain points. The "friction is good" approach also severely hurt us, because too much time was wasted haggling instead of doing. (I specifically told the exec, the last time we met, it felt like he was running the air conditioner and heater at the same time.)

This exec is making a similar mistake by basically giving a small team unlimited tokens, instead of understanding how other players in the industry tackle these same problems with AI. It's not that their overall idea is bad, it's that they are probably starving the rest of the business on an unproven experiment / poorly chosen risk.