I had an internship at HP in the early 2000's, and my computer was a terminal that connected to an X server in a data center. Doing everything as a service is not a new idea, and suppliers have been trying to push it for decades.
The only time it really succeeds is when regulations force it. I can store files on my own computer or a home NAS just fine, but if I start a medical practice, I have pretty much no hope of being HIPAA compliant without signing up for a data hosting service. The same goes for tax preparation, banking, and several other fields.
It may very well be the case in China, Europe, or Australia that regulatory restrictions force users into models-as-a-service, but in the US, regulations censoring models, even if they frame that censorship as a safety measure, won't pass constitutional muster.