What's wrong with both? A true democratisation of this kind of model would involve both an offline model for those with the resources to support such a thing as well as many different people hosting them and allowing access for a price via an API for those without those high end resources.

I think the issue people have with centralised cloud APIs for this sort of thing is that there's still a single gatekeeper with their finger on the off switch. In my opinion, instead of throwing out cloud APIs altogether a better scenario would be many gatekeepers with a deliberate diversity of socio-political backgrounds.