IME even a small company runs into something you need an actual server for, and then you're suddenly spread across two clouds because Cloudflare is serverless or nothing.
The reason aws is dominant is because it’s the default and a known quantity. But developers and cost conscious organizations will look at alternatives. Not saying it would be easy but the prize would be huge. Plus AWS seems in chaos with a lack of sensible leadership.
I'm guessing it's just because they're so extremely all-in on every single of their products being on the edge, and you can't make that work with VMs without becoming far more expensive than any of their customers would pay.
Or maybe I'm clueless. But it sure looks that way from the outside.