I mean because a company tends to explode from "smaller than $MARKET_SHARE" to "larger than $MARKET_SHARE" in a discontinuous fashion. So since a company can't really predict when it will happen, every company providing service would need to prep from the ground up to provide the described level of relatively non-automated high-touch support this proposal describes. It'd raise the cost to build a startup.

... not to imply it's a bad idea; there's no golden rule that says an ecosystem of millions of competing companies is always a superior alternative to a few well-regulated players. It's just important to note the hidden costs.