This is absolutely true for all the streaming platforms. My Jellyfin/Plex servers with pirated content are set up in a fairly ridiculous way: I use sshfs across multiple seed boxes located on different continents to "merge" the filesystems in a way that is transparent-enough to Jellyfin that one server will serve up all the content.
Even with this somewhat-absurd daisy-chaining, I can serve much higher bitrates to my home than Amazon, Disney, Netflix, Hulu, etc. The encoding quality is much better and even completely video-naive guests who know nothing about technology notice the difference and comment "Wow, the picture quality is so good!", especially with anything like Dune 2 or Planet Earth. Even when the video gets transcoded on the fly for device-compatibility, while it's degraded, it ends up still being better visual quality than the major streaming services.
The streaming platforms are definitely optimizing for minimizing their costs rather than serving decent bitrates that the user-agent can handle.
If you really care about visual quality, I do reccomend trying to get a membership to PassThePopcorn, or rip content from BluRays yourself, which you can rent from libraries. Ripping is really not much effort once you learn enough to do it once or twice.
I'll start using the major streaming services again when I can actually receive not-mangled visual quality from them.