"The way to make this profitable is to use the OW as a loss leader, kind of like razor blades. If the course/instructor is good, then the students will come back for more. They'll be hooked and they will want to learn more. They will realize that by having better bouyancy they'll have more fun, breath less air and have better visibility. They'll learn that to be warmer, you need to wear a drysuit, but there are procedures that you need to learn. They'll know about deco problems, and that you need to learn more than the basic tables."
No, the empirical evidence is that they don't. At member updates and in internal publications, PADI contsantly laments that most 90% of open water students do not seek any further training, ever. Most people do not want knowledge or education, they want the benefits that people with knowledge and education have, without having to put forth the mental effort. Otherwise we wouldn't have an education crisis in this country. Most people are perfectly content to be lousy divers, as long as it doesn't bar them from diving, so they can say they've done it before moving on to bungee jumping, or whatever the next trendy thing on their list is.
"Crack dealers know how to get their customers addicted, the key is to get customers comming back for more."
And there you have it. What an appropriate yardstick for PADI - crack dealers. As long as we're making money and giving our customers what they demand, it's all good.