Thank you for stating this. I absolutely agree with you, and this is what we are trying to do with the Deuxfleurs collective which is also getting funded by the EU to work on our project Garage [0, 1]. We are working on making self-hosting easier, and also more reliable, by exploiting geographical redundancy [2]. We will use the grant money mostly to develop Garage, our self-hosted data server (an object store implementing the S3 protocol, and soon also an email inbox server with IMAP access). We are also working on automating opening ports on your router to get around NAT (with our project DiploNAT [3]), and on facilitating distributed deployments with the Nomad orchestrator. Our vision is to help technical users set up local self-hosting collectives by setting up servers at three or four geographical locations for redundancy, which can then be used by their friends, neighbors, etc. We are of course very keen on deploying federated protocols such as Matrix to link all of these communities together.
For an outsider, yet one that has a soft spot for decentralization, I can't understand what niche the projects are solving.
Technical users can already rent a vps for very cheap and do it there. HA works only as well as it was tailored to - no generic solutions will change that, unless they impose harsh complexity.
With Garage, we are trying to eschew the need for a VPS, or at least provide on-premise failovers for individuals and tiny organisations.
Our argument, as stated by OP, is that domestic connections are now powerful enough to release the load on datacenters. We deem it more ecological and empowering to plug-in an old computer to your home box.
[0] https://garagehq.deuxfleurs.fr
[1] https://git.deuxfleurs.fr/Deuxfleurs/infrastructure
[2] https://git.deuxfleurs.fr/Deuxfleurs/garage/src/branch/main/...
[3] https://git.deuxfleurs.fr/Deuxfleurs/diplonat
Not linking our main website because it's in French.