You're not a software company, fundamentally you make and sell Sprockets.
The opinions here would be hire a big eng/IT staff to "buy and maintain servers" (PaaS is bad) and then likely "write a bunch of code yourself" (SaaS is bad) or whatever is currently popular here (last thread here it was "Pushing PHP over SFTP without Git, and you're silly if you need more" lol)
But I believe businesses should do One Thing Well and avoid trying to compete (doing it manually) for things outside of their core competency. In this case, I would definitely think Sprocket Masters should not attempt to manage their own hardware and should rely on a provider to handle scaling, security, uptime, compliance, and all the little details. I also think their software should be bog-standard with as little in-house as possible. They're not a software shop and should be writing as little code as possible.
Realistically Widget Masters could run these sites with a rather small staff unless they decided to do it all manually, in which case they'd probably need a lot larger staff.