I think the fallacy in this argument is not that quality doesn't win out, but that quality isn't always important.
The problem is that the determination process is flawed.
I might make the decision that I need lesser quality (whatever that means) for an internal time-keeping application than I do for something customer-facing, such as my sales portal. The article is of course arguing that I shouldn't be making that decision based on initial cost but on longer-term factors, but on the management side of things as long as I've got a fixed budget rooted in the short-term I can't make that decision equally. Like many financial equations, X dollars today vs. X dollars tomorrow is in play.