Is it a blunder? Tell that to Apple, Jetbrains, or Microsoft, each of whom have proprietary code editors that net billions of dollars of revenue.

I expected you to say that! The only mentioned company that has a proprietary code editor is Jetbrains with their Fleet. Visual Studio, XCode, most jetbrains products are IDEs.

IDEs are big, bloated products that don't need hackability because they already come prepackaged with everything. Code editors are different. Developers also like stuff being open source so they can put their trust into it — if everything goes to hell, somebody could fork it, which would save you from the need to find another properietary editor and change your workflow.

Ultimately, who develops OSS doesn't matter anymore. Even the Linux kernel, the thing that comes to mind to most people when they think of "open source", is developed by a lot of people working for corporations, on paid positions specifically to develop the kernel.

Instead, consider that making something open source is often just a marketing strategy — or a soft way to sunset a project.

I can't disagree with that, but my point is that if being an open source code editor is so important, then there is a bigger probability that the team behind Zed are fixing the mistake, rather then sunsetting the software.