This is how many (most?) teams develop at...Amazon. It definitely scales to large teams and large (1000TPS) projects.
And those systems have the entire Builder Tools org making sure they work.
At least their solution architects get some moral redemption from peddling these messes..
Are you arguing that using SaaS developer tools like the ones in this journal entry consumes a greater proportion of engineers' capacity than self-hosting does, and that this cost difference becomes proportionally greater as a company grows? If you're right, perhaps some cloud-based startups and also larger businesses will be eaten up by more nimble, efficient self-hosted competitors.
(I work for a cloud host)