It's all part of their plan.
Now that everyone claims to know what EA should have done, they're primed to buy the sequel, SimServer. Where you get to layout the network infrastructure for a new online game.
Smaller and cheaper means they'll become more ubiquitous.
Your desktop may not be getting much faster, but your TV got smarter, baby toys have more computing power than your first PC, a new car has more smartphone features than your phone from 2007, and everything else seems to be getting more computing power whether it needs it or not.