Synology has been resting on the laurels for years. They had a "hit" with DSM 6, then did mostly nothing for a decade, released DSM 7, and again, nothing but minor things since. On the hardware side of things, they're mostly still using decade old hardware, but i guess that matches the Linux kernel they're using, which was also EOL close to a decade ago.
Meanwhile the NAS market has been flooded by viable alternatives with better hardware, equal or better software, and usually cheaper. UGREEN and others have released more or less drop in replacements, and Ubiquiti released the UNAS line, and while it doesn't work as an application server, will run around circles any similarly specced (drive wise) Synology in raw file transfer performance, for half the price.
I'm guessing the 3rd party drive removal was simply just the final push that caused many people to switch to something else. Transcoding removal was likely also a big driver, as many people also use their Synology NAS as a Plex server.