Quite so. The SMG has to be seen in the context of a weapons system. The short range firepower of the SMG is supported by the longer range fire of the LMG. Also the long range firepower of the MMG and artillery. By itself it has limited use. In a storming party it needs grenade teams and the LMG team to suppress a counter attack. There is no best weapon. Only the best for a given use. Video games suffer from playing as a soldier and not an officer.Running out of ammunition is not something that is a surprise in the fight.It is anticipated higher up and rifle/SMG men diverted to carry more ammunition for the LMG for example.You're sticking to a video game conception of combat.
Look up what really happened in 1914 to 1918.
There was an attempt to use SMG as short range suppressive fire weapons, from the Germans with MP18 and from the Italians with the VP. The first MP18 were meant to provide suppressive fire. They failed in that role. After WW1 SMG were only issued in large number either as PDW for tank crews, etc, or issued to platoons that were liberally equipped with LMGs.
SMG cant provide sustained defensive fire because they don't have the required quick change barrels (though some were actually built with them along with bipods in the 30s, proving to be nearly useless as short range mini LMG), heavy barrels or liqid cooled barrels.
To have an effective SMG armed platoon in need to have one LMG for each squad, ideally with another two in the support squad. In 1914, without LMG, a SMG platoon would not work. even in urban fighting it would be limited in any firefight that was not happening with both sides inside the same building.
When you see images of WW2 soviet infantry with SMGs, you also see LMG everywhere.
With a little more oomph from the round the simple blowback, with a bipod, can suppress to 300 metres. Especially as one has multiple SMGs. The oft quoted 9mm Mauser export, like the Tokarev, is approaching the limit of the simple blowback without excess weight. The Schwarzlose MMG shows how far one can take the blowback but an SMG it is not.