The cloud has eaten all the hardware improvements of the last decade. It's insane that my base model Macbook routinely outperforms the (expensive!) AWS crap that most companies use as their application "servers" and yet it's the reality in many places.

So to a certain extent, you are forced to over-engineer for distributed workloads because any single node has the performance of a pocket calculator. This obviously benefits the cloud provider because not only do you rent more resources from them but you now rely on their management platform to orchestrate all those workloads.