What happens when your competitors invest in better and more expensive tools or materials in general? They (potentially) make better products, but those products also cost more. It's turtles all the way down.

The target audience is likely those who can't or won't use frontier models unless they are on-premise.

Cool! That's when you pay the difference in marketing and auto-win your sector! People don't actually buy the best, they buy what they think is.

You buy the competitor and kill their culture from the inside, ruin them and take a tax loss on the company.

depends on the economics and much more, the best Ai cannot do a lot of things, 90% of human tasks by some reports

we technologists tend to extend what we see and think to other realms where it doesn't make sense