Host in my closet or basement with a one-way data flow. In only, not out.
How much of the general public is going to be capable to set up and maintain a server in their basement? To challenge YouTube, targetting just the programming crowd isn't going to be sufficient.
The general public seems to be capable of setting up and maintaining a Nest thermostat. The only difference would be that data only goes down, not up.
I guess if you sell a pre-constructed device, that could work. There would be other issues (you have to spend money on hardware, potentially have to get it shipped, may not be able to get access to the device at all based on your region, keeping it always on and accessible, etc).
Some portions of a personalized, cross-service recommendation engine are a lot more viable if centralized (e.g. any scraping/indexing, and plausibly the personalization itself). Supposing such a service had no intention of you ever personally being the product, what would they have to do in order for you to still be comfortable handing that data over to them?