That's a good point. Who really knows, but possibly Google just doesn't see that coming, or at least not any time soon. A true competitor to YouTube would really do consumers and creators a lot of good though.
I think Facebook could actually properly compete with YouTube if they wanted, it's just that their insistence that you have to be logged in to access content makes it much less appealing as a platform, because you can't just link people to videos easily.
...hence the ads? How would competitors be immune to the need to pay the bills?
It's not just the ads that are the problem with YouTube. It's also the way they can just demonetize anything that doesn't please advertisers, and the way their recommendation algorithm works. They don't even show me a lot of the videos from people I subscribed to on the app's homepage. Wtf?