That's not very good for small developers that may want to iterate over their games or provide extra content for their users. Developers who simply do not have the resources to test in a wide variety for hardware, or to get their game just perfect for the first update. And as a user, I love having access to games by these developers. Steam would lose a lot of value to me if it wasn't such a helpful platform for small devs.
And that's without even getting into updates that provide extra content. Steam's flagship game, Team Fortress 2, updates at least once a month with extra (free) content. That generates mayor amounts of good will towards the devs, and it would be completely unsustainable if the developers had to pay $40k to update, and another $40k to fix any bugs or imbalances in the update.