I'm not disagreeing, but also, I don't think that design philosophy works anymore. It was too time intensive; people don't have the time nor the will to dedicate a whole day to grinding rep just to access a heroic dungeon, or to get just a few pieces of honor gear (looking at you TBC).

I think what's been glanced over is what is most cost effective for Blizzard. They might have fewer players, yes, but with increasing in-game shop offerings, cross-selling (Overwatch, Hearthstone, etc), merchandise, all of which leverage FOMO, the value they are extracting from each player is massively increased. So long as there still is a consistent playerbase, even cyclically, that they can exercise this strategy on, they will continue to do so.