OpenTelemetry (or OTel) is in no way an existential threat to DataDog. Primarily because OTel is simply the substrate/protocol by which data is collected from your apps/systems. DD does _a lot_ more than what OTel provides (RUM, SIEM, synthetics, on-call, dashboarding, anomaly detection, and much much more). If anything it's an existential threat to the more legacy vendors that aren't equipped to provide an OTel ingest layer.
OTel _does_ prevent lock-in on the agent side (making it easier to switch vendors) with open source components and consistent schemas, but OTel doesn't enable you to do anything that you couldn't do before with a specific vendor. It just empowers you to take ownership of your observability data, should you want to. Many don't, though. They want to throw money at someone else who can do it relatively well, hence the ridiculous DD pricing.
Regarding:
> Not sure how companies rationalize these types of services at scale when there are so many open source options to run for a fraction of the cost
At Coinbase's scale (which I assume is a lot due to the DD bill, but I haven't looked closely at it) the open source options simply won't cut it. Plus there are no scalable open source options for many of the things that DD does (synthetics, SIEM come to mind - not to mention onerous regulatory requirements). 65M seems like a lot, but it also means their cloud costs are insane - so maybe it lets them put focus elsewhere?