It's basic organizational politics. Any organization will have difficulty adapting to a completely different platform, and management will attempt to reframe the problem to fit within the bounds of their existing organization.

In this case, a traditionally web-focused organization attempted to co-opt mobile development into their existing organizational hierarchy by reframing the problem. It wasn't until persistent external pressure was applied (user complaint, blatant failure obvious to external management) that they were forced to accede ground.