Hi Darren, I do take your point as I too have been a developer for many years (but not in internet related stuff)
However, there are times when you need some help with..........well, ideas! Sometimes I have so many thoughts running through my head about what I could do for my next project, that I need someone else to do the focusing for me. In this case, it makes sense to hire someone to do the market research and write the spec for you before you then hire a second person to do the coding.
Let me explain:
I am the entrepreneur - the idea creator.
I hire Freelancer No. 1 to explore my ideas further, look at competition, analyze the market and come up with a plan.
This plan then needs to be turned into a spec for a developer (this could either be myself or again I could even outsource this stage).
The programmer then gets given a comprehensive spec and brings it altogether.
.........now that's maybe an extreme case where I could be hiring 3 different people, but its not far off how larger companies work. The difficulty is always finding the good people and then retaining them.