The last couple of years have shown that there are some serious long-term contract management and salary cap management problems at the club, and you don't fix that problem by adding even more bad value to the cap. Watkins, as he is today, isn't worth marquee money.
I'm annoyed to see him go, there are plenty of players I'd rather see let go and it shouldn't have ended like this, but solving those issues relies on players being as willing to negotiate out of their contract as Kal has been.
Players like Kallum are far from the biggest problem in this regard, but people like Tui Lolohea, Nat Peteru and Tom Briscoe know that they aren't going to gain anything by negotiating their respective deals away - they're on too much of a good thing.