There use to be lots and lots of ISPs and so they were small enough to have a single webserver with all their customers setup as users and Apache serving content. They'd also setup FTP on the same server so you could get your html files into your www folder. Software like Dreamweaver had a ftp client built in, so you'd click like a "publish" button and it wold login to FTP and transfer your files.
i would imagine this went away because it got expensive as the customer base grew and ISPs consolidated and it made no money. Other options with php, mysql, and other services cropped up and could offer more and charge for it so I think ISPs just preferred to concentrate on network access and not hosting websites.
It is also possible to add .htaccess and other things there, like username/password challenge (WWW-Authenticate) into that on per-user basis.
Mostly universities had hosting setup the same way. ISPs would also offer a similar thing with an additional fee to your internet-subscription. They mostly provided FTP to upload files. Nowadays if anyone tries to, it will be a SFTP rather than FTP.
https://www.cs.cmu.edu/~btitzer/riff.html
I actually haven't had a homepage for a long time because of the lack of the easy "put my home directory on the web", but I'd like to go back now to doing that.
I used to have my choice of dozens of ISP's. Now if I am lucky I might have 2 or 3 from very large companies that did the math on keeping that going. It mostly happened when ADSL and cable took over. In most areas that meant only 2 or 3 companies could actually provide anything at speeds their customers wanted. Think at the time they always said it was cost cutting.
Unfortunately reality is such that those are closed systems with historically abhorrent security and ISPs usually forbids the user from properly providing their own choice of router.