A much bigger value is that VSCode brought Microsoft into the consciousness of developers who would have otherwise never thought of using a Microsoft product for anything. It's been so successful that there are even classes of developers who think that "Visual Studio" refers to VSCode, not big-poppa-windows-application Visual Studio.

Source: I worked in the dev tools business at Microsoft for the past half-decade.

I'm not saying this is bad or evil but let's first be honest

That's definitely not true w.r.t strategy. I could speak quite a bit about the challenges of doing things with VS, since I worked directly on tooling for it. There are maintenance issues like any huge codebase with thousands of little things it supports, but you're probably not aware of how internal infrastructure for VS has made enormous improvements. Among other things, one of the products I worked on went from an unreliable 24-hour turnaround into a 4-hour guaranteed turnaround for my changes to show up in dogfood builds. Everyone who works on VS also thinks that can be improved, and works towards improving it too. It was actually one of the more heartening things to see: multiple teams who give a shit about engineering systems and make an effort to improve them over time. This narrative that VS is a mess and VSCode is somehow "the future plan" is complete nonsense.

VS and VSCode couldn't be any more different. Visual Studio does so many more things than VSCode, and that's by design. VS is a fully-fledged IDE, and the intended use is that practically everything you do is through the lens of VS. VSCode is fundamentally an editor that is a companion to your other toolsets. It's not meant to replace Visual Studio for VS's users, because doing so would mean building so many things into VSCode that more or less go against its entire design philosophy. Such a decision would be bad from the business's standpoint, especially since VS itself has no significant problem evolving over time (hello 64-bit new VS!!), and there are so many more high-leverage things to do for VSCode than re-creating things that already exist, But In Electron Now.

> Also, they use Visual Studio Code to upsell their other paid services.

Well, yeah, of course. It's an editor suggested in all kinds of contexts, there are product-specific extensions (proprietary marketplace!), and when you have millions of people who love a product, why not try to upsell some of them? That's what I'm alluding to. Nothing dishonest here.