For the same reason that most businesses are on AWS/GCloud rather than having a server room in the office.

Self hosting is a complex investment. Competitors need an stupidly expensive amount of hardware to enter the scene if they're going to serve SaaS. Chinese backed models can be regulated out of competition. Openai and Anthropic will soon be semi exclusive sources of training data as development happens on private conversations.

Success is not guaranteed, but it is crystal clear that the goal is replacing us and then pricing the replacement as the largest possible percentage of our salaries possible.

It's the oldest trick in the book. Place a heavily discounted supermarket in town, wait for all local businesses to close, raise prices.