Anecdotal: Ease of use has always been a major selling point for shared hosting, now more than ever. Not everyone wants to be a sysadmin, and John's Pizza sure as hell doesn't know what a VPS is. They just need a simple WordPress install.
You're right, but that doesn't mean people need shared hosting, it means people need managed hosting.
Shared hosting is a gimmick model designed to make hosting companies rich based on the concept that 99% of websites will be failures.
And it is _nothing more than that_.
If you outgrow it, sure, but your odds of a small business or little WordPress blog outgrowing such a thing are quite small. Paying more might not make sense in that "99%"of websites.
> You're right, but that doesn't mean people need shared hosting, it means people need managed hosting.
I'm going to very much disagree with you.
Why does Joe's Pizza need managed? They can follow one of the zillion tutorials on using fantastico/softaculous to install WordPress, find a theme from ThemeForest, learn how to install it, and then add pages. They don't need to pay ungodly managed hosting fees for their low volume.
What defines a successful website? Not IPOing? I would define a successful website as one that has organic traffic (somehow), content, and response times under 250ms.
If you use my definition, 99% of websites are successful.
Sure, shared hosting is a volume game for the most part because the volume game is _easy_. There are providers who are on the higher-end of shared hosting spectrum, charging a premium and providing a premium. All because you don't see their ads every day doesn't mean they don't exist.