On one hand, Google is doing its part to help with fragmentation in Froyo by making core apps part of the market like they did with maps - that way they can push updates to these things without having to wait for HTC to update Sense, the carrier to approve it, etc.
On the other hand, Google themselves have admitted that the biggest struggle with fragmentation is just different devices. When talking about why their keyboard sucks, they mention how its a lot harder to make a solid keyboard when it has to be solid across multiple device sizes. He's got a point. Also, think about game developers...a lot harder to deal with devising a solid input scheme that will work on every device.
That aside, we all know (yes, all of us) at this point that it is absolutely laughable to say devs won't touch Android. Does it have as many apps as Apple? No. Are they generally as polished as iPhone apps? No. Are there still tens of thousands of apps, with thousands more pouring in every month? Yes. Are the big name development studios/apps being ported to Android at a much better rate than they used to? Yes. Lets be serious, folks.
Although all of this flame slinging (initiated by the usual suspects) has little to do with the article at hand anyway.