There are arguably benefits to this arrangement. Prostitutes have pimps, even though they cut into profits without taking much personal risk or providing much labor, because pimps do provide a safety mechanism. Likewise, vassals gave up large portions of what they produced for security from their lords and kings.
We've returned to this arrangement because:
1.) Paying is painful and copying software is easy. Instead of making money from you, Web 2.0 have monetized you as a target for advertisers. Web services are 'in' because that's the only way software can't be pirated. Much of our software today displays GUIs on a screen but runs on other computers because of this reason. The new Office products all run in the cloud, MMOs offer the same deal, and games like Diablo III can only run when in constant connection to the internet, even though there's no technical reason why that should be the case. XBox One tried to (and backpedaled from) make the xBox always on always connected. Other streaming video game and content services try the same. Essentially, the internet has become glorified TV (minimally interactive), with more channels.
2.) The internet is the Wild Wild West. Security professionals have been yelling for ages that the rush to release and the need to compete together with closed source development was making the world an insecure place. Essentially every layer of our computing stack is insecure. Attestation of computer intrusion is ridiculously hard. And there's money (and geopolitical power) to be had. We designed things insecure from the start, and continue to do so. Individuals can't stay secure on their own. It's not possible. So up with the lords and vassals - we know it sort of works from history.
I do think the average user cares. I don't think the average user is informed.