Yep. There's simply no money in just "pushing bits" anymore. That business has been consolidated by people like Google and Amazon.
You have to both provide a valuable service, as well as create a "network effect" around your product. Otherwise you're easily susceptible to being out competed.
Couldn't the whole internet be generalized as "file hosting with a bunch of links"? A "file host" is a company whose primary purpose is for you to upload a file and give the link to someone else; they're a middleman that exists only because a more convenient/direct means of distribution to the intended network isn't available. This does not make the company nearly loud enough to establish its own identity/user base.
Facebook has always been its own repository of people intelligence. It was never just an "upload your photos here". Such platforms, like Photobucket or Imgur, sometimes prosper for a while, until the communication channels that reach the intended audience directly offer something easier. (imgur is going down now as reddit introduced its own image host last year)
(Not that I use it.)
Realise that the flipside of such services is their real customers -- the adverts side. For online advertising, the two largest agencies claim over 60% of the market, and are named "Google" and "Facebook".
Everyone else is an also-ran. Which for any ads purchaser means "a lot more work for a lot less reach".
The truth is that users are not loyal. If you are offering something for free, they will be happy to take it, and they will have no qualms about moving on when you stop giving them the free stuff that they came for. Selling eyeballs is a very tough business. People who want a realistic chance to make money should have plans besides "sell ads".