They produce nothing except market crashes.
They produce one other thing, that is important to you and I, and that is liquidity and price accuracy. Before electronic trading, stocks traded in spreads of 1/16 to 1/2 point, or even more. That's 12 to 50 cents. Per share. That the market maker put in his pocket, from the average stock purchaser.
With electronic trading, spreads are commonly 1 to 5 cents. That difference is real money when you buy or sell your shares. On a 1000 share lot of a $20 stock (typical for me), the improvement in liquidity means 1 to 2% improvement in return on each end of the trade, simply from the improvement of the market economics. That's money that the ordinary investor gets, that used to go into the pockets of the big brokers that make up the exchange.
The folks doing millisecond trades are arbitraging between various instruments, and I don't think the daily action of their business hurts us. This situation appears to have been due to a technical malfunction of the market, rather than a basic pernicious practice such as the whole sub-prime loan debacle was based on.