The only way that argument makes sense is when inverted. Packet switched networks did not compete with loose wires hand placed by polite women. They competed with circuit switched networks which emulated that network architecture.

And packet switched network equipment were much, much, much more simple than their time divisioned counterparts. On the same budget you could run an order of magnitude fatter pipes using ethernet switches rather than ATM switches. That's also why they won.

Simpler and cheaper architecture end-to-end means the same budget can be spent more wisely. That's usually what wins in an open market.