That’s not what necessity means. I think most users of this device will be fine with 128gb. I think you underestimate cloud usage for this machine’s target market.
I'll bite. My parents have got a ~2014 Macbook Pro and 1 megabit upload on ADSL. They're just starting to use "cloud" services like OneDrive. If a large upload starts, no one else in the house can use the 'net. I'm dealing with ~100GB of photos that only have one backup now and it's a nightmare.
I wouldn’t want this little storage onboard, but recent macOS versions do include the feature to automatically shuffle infrequently files up to iCloud.