Dont know why employers do this. Why pay for shitty tools your employees hate ?
It really feels like ADO was just quickly patched together to they can offer it as part of a complete package.
And regarding Microsoft, it's easy: paying for the whole package is much easier in terms of contract overhead and with MS the discounts are quite advantageous as soon as you increase the width of the package.
Short term and if you only look at the bill, it makes sense.
Long term, forcing your teams to work with shitty services is a terrible idea.