The are a skimming middleman in effect, but instead of having to produce game boxes or provide a streaming data service themselves, game companies can instead offset that cost and go through Steam - for a price. Now that Steam is so popular and most gamers instantly check there before anywhere else, it's almost a "must use" deal for anything other than niche products. Even indie games have the largest following on Steam IMO.
I remember back when I worked full time for an online gaming site, back in 2000 or so, when the Valve people first told us about the Steam concept and how nobody would buy boxed games in the future. We laughed, thinking that nobody would fork over their 50$ to not get a hard CD copy and box of their game for their hard earned dollar. Heh. Didn't see that one coming obviously. Same deal I guess for when Microsoft gaming first told us about their secret "XBox" project that would bring PC hardware into a gaming console - who would want to buy that instead of a PC?!
I still think HTC could increase numbers back to their peak levels and higher on their own. IMO having a system that allowed free to play members into the arena, yet would prioritize sub clients over them, to fill up the open slots say to 800 or whatever the servers can take would be the best, cheapest option. Give them a jeep, crappy tank, Storch, and maybe a very weak fighter/bomber. Nothing would make new players want to pay to sub more than seeing the fun everyone else is having in all the planes/tanks/etc that they can't unlock - it'd be a far better hook than tic-tac-toe or sheep stealing, I'd bet it all on that.
IMO this would work - I have no idea regarding the complications of implementing such a thing, I just believe that it's the most cost effective way to go, better than any ad campaign or Steam type venture. Fill up the empty player slots with FTP - some of them will become paying clients, and eventually it'll get to the point where there will be enough paying members flying again to fill the arena, and then another split could happen or an even larger arena made. This method also fixes a lot of complaint/issues as well, as the most common is "not enough players". Well, having a ton of FTP targets will fix that in short order, and give sub paying members a lot more live players to interact with. This interaction will also breed more subs from the FTP players, as they'll want to be in on what the sub players are up to and talking about, higher end fighters and bomber raids etc they'd be locked out of without a sub.