Even self-hosting on AWS, GCP, or Azure isn't local enough for certain application, such as people doing export-controlled work where any sysadmin or person with physical access to the server/data is required to be a US Person (or equivalent in other countries). This is the niche that the govcloud solutions are aimed at serving. But some people just want to build big actually-private, actually self-hosted systems and do their own physical and network security.