I'm not sure a data center run by ... Palantir of all organizations is what people have in mind when they worry about data sovereignty.
Fair but the idea of "running your LLM setup" at every "need" level and corresponding cost does make sense.
For a lot of people (and orgs I'd guess) who just go and buy ≈$20 per month plans (or more for teams), they might not even need a fraction of that cost or capability. A lot of them don't even need it for coding or graphics. Even the API access based pricing aren't great from these frontier US AI houses. The distribution of "LLM being" offered will also give rise to many open-router like offering but at the end point level - direct interfaces to the customers. Pick your vendor sort.
AI shouldn't become another "search means Google".
They are selling it, not running it.
It is just a dedicated computer system, which should be managed by its owner, like any other on-prem servers.
I doubt that it has a good price/performance ratio, but it is a solution for those who feel that they do not want to search, buy, assemble, install and configure every HW/SW component.