Of course, that means the gateway must terminate the TLS connection for every site (and therefore be able to read its contents), whereas with SNI it could redirect the TLS connection itself to the appropriate server, while being unable to spy on it.
In practice what happened before SNI is that every SSL/TLS site used a dedicated IP, which makes it quite easy to block.
Still, it's a matter of politics, and not of technology. Google here chooses to stop covering for Telegram/Signal, even if the technology allows it.
[1]: https://www.ietf.org/proceedings/94/slides/slides-94-tls-8.p...
I could also see state operators mandating the plaintext SNI (by dropping non-SNI TLS), and operating a transparent TLS proxy based on that SNI with their own DNS lookup (so you would have to provide a legit, resolvable hostname in the plaintext SNI).