Google, Facebook, etc have so many apps and have so many users that it would be crazy for them not to control their identity systems. A team of 20 people maintaining OAuth servers is a rounding error for them. They tend to want as many moats as possible (not because moats are good, but because you have to be paranoid AF to grow to a multi billion dollar company.)
With distributed apps, the app writer doesn’t host their app, it’s hosted by random miners all over the world. This makes open source hosted services suddenly very easy for individuals to write. You don’t have to start a company to host your service, you just have to write it. Similar to the olden days when you could just throw up a tarball on a FTP site and millions of people could use your app.
So it’s a very lightweight social structure holding up the nuts and bolts of running the service.
However that creates a problem: there’s no trusted party there who is actually unlocking your data and assuring you and other that you are in fact you.
If you have super duper OpSec skills, of course you can just maintain your private keys, get a safety deposit box for your backup tokens, etc.
But for normal users that won’t be an option, so this space of open source decentralized apps will create a market for someone to provide at least basic identity services: holding backup keys, resetting your passwords, revoking session tokens, etc. And once you’re doing that you might as well throw in drivers license validation, group level data access control, etc.