That would be even worse for them, since then current customers of these AI-middleman corpos would just start deploying their own self-hosted and private LLM se

That would be even worse for them, since then current customers of these AI-middleman corpos would just start deploying their own self-hosted and private LLM services. In before the complexity argument, there may well be some completely different middlemen corpos, who will assist in such deployments and initial ramp-ups.