Assuming the chance of an outage is actually static. If there is one (highly reliable and trusted) provider with five products one year, and three providers with ten products the next year, the chance of you seeing an outage has gone way up because of surface area.
for those with budgets to hire server administrators (or pay for third-party managed services)? yes.
second category includes almost anyone with a large following like institutional users.
hell the incumbent social media service operators can white-label their existing software and sell this as a service.
Self-hosting is a good option, especially when mixed with multi-cloud offerings.
The big rub is that it's really hard to approach the same level of availability the cloud offerings already give you. Depending on work-load, self-hosting is typically more expensive.
This is why the SRE book talks about availability budget. You can't have 100% uptime, so how much do you want to pay to get close to it?