Thank you for the “no snark” tag.
None intended from my end either! Canon have seen their profits fall off a cliff in the iPhone era, as has every other manufacturer. I think we’re all on the same page there. The M mount has existed across that timeframe and has sold really well for Canon (and as you’ve pointed out and I totally agree with, is a great product). If a product is selling really well, but the company is losing a lot of money, it would suggest to me that the profit/margin on that product is not very high. Good for you and me, not so good for the company.
Canon have stated over the last couple years that their solution to this problem is to focus on high-end imaging, where the margins are much better. They can charge whatever they want for a high-end camera, as long as they give it sufficient specs to justify the cost. It costs more to manufacture, but not that much more than an APS-C unit, a lot of the components are the same… Looking at the latest report (which is tough to dissect because of Covid), the strategy seems to be working. They sold way fewer cameras this year than past years, but because so many of them were R5s/6s, profits improved quite a bit.
So, sort of to summarize the thinking is... let phones have the entire low-end market. There’s no need for EF-M, micro4/3, or other cheaper APS-C solutions. You and I both like them, but go outside and see what the majority of people are taking pictures with… we’re part of an increasingly small group. You just can’t sell enough of these “entry level” cameras anymore to make any kind of real profit to justify the effort. Instead, focus on expensive high-end cameras that can do the things that phones cannot do and won’t be able to do for the foreseeable future. You’ll sell a lot fewer cameras than you used to, but make a lot of money every time you do sell one.
Also, be careful of using logic from 10 years ago. Many people will immediately point out that Rebels were where Canon made most of their money... 10 years ago. Totally true in years past, but phones weren’t competitors then. This is a much different market and it requires a much different approach. I know you’re not going to like any of this… I don’t like it either. I wouldn’t even ask you to agree with me; but can you see how the line of thinking goes, even if you absolutely hate it?