How is bad for the industry? It's certainly not great for MS, but they were doing it to Sony last gen.
Lets look at two different strategies used this gen
MS likely spent tens of millions of dollars on Scalebound, advertised it for years, took it to trade shows, invested years of time, money and resources into it. The game gets cancelled, and even if it worked out and they made a great game of i it, it still would have probably bombed and lost them a bunch of money.
Who was that good for? It was bad for MS, it was bad for Platinum, and it was bad for the fans who were looking forward to the game.
Now look at what Sony did with Destiny, they paid for the marketing rights to the game, MS still gets Destiny, but Sonys PS4 sales DOUBLED during September 2014 NPD when Destiny came out.
So Sony pays Activision so Activision is happy, Sony doubles PS4 sales so they're happy, retailers sell a bunch of PS4s so they're happy, gamers get Destiny so they're happy. Thats a win win win win.