If I interpret your point correctly, you are assuming Sonos users only want HD Audio and anything of lesser quality is unacceptable. But your thread title asks “Why Would Anyone Chose (sic) Sonos”. Not all Sonos owners want or need uncompressed audio. For some, the multi-room features and wireless interconnections have enough appeal, and for them they certainly would - or might (there are other players in that market) - choose Sonos, in 2021 and beyond. 

The problem that Sonos was invented to solve in 2004 does not exist any more, except for a small number of users who aren’t a big enough market. That is their strategic challenge while they search around to see if there is a present existing problem that they can solve better than others in the larger market of users of streaming services.

Sonos still does perfect sync multi room better than most; that said, in the last month or so, in a search to see if I can get album art for what is playing is more than one place in the open space core in my apartment, I have found that Echo also now does perfect sync grouped play just as well as Sonos does. 

So it isn't that Sonos has become irrelevant, but that many others are now equally relevant.

Although you mention higher def streams, your main argument seems to be about the lack of support for most modern local streaming options. The reasons why they have neglected to do anything about it have been posited many times. I think we just have to accept that there are no longer enough people streaming locally to form their target market.

I still buy CDs and rip them to flac for local streaming, but I don’t know anyone else who does. Despite being an ex-IT person, I’m often the last to abandon much loved tech (LPs, CDs, local streaming, film cameras).

Although Sonos has come up with some good ideas. e.g. Trueplay, they never bothered to get it working on anything other than iKit - again, an issue discussed at length elsewhere. As they also fail to support common modern tech (Chromecast, Bluetooth) in their kit, I feel that they are now falling well behind - certainly from my point of view. If I were looking now for something to build on into the future, I’d be looking for something much more flexible. There has been quite a bit of discussion about splitting the ‘smarts’ from the audio side, and that seems the best way to go these days.

As @Kumar said above, other people now do multi room sync as well as Sonos, and they also embrace all the modern options as well. 

Another SMBv1 rant only with more words. With a pinch of HD audio thrown in.

Almost no-one cares for local file playback in 2021, and a small subset of those use NASs instead of their PC/Mac (which still works fine and is simple to set up).

Move along, nothing to see here.

In 2005 SONOS was by far the least expensive full feature whole house audio distribution system. You could purchase a few rooms of SONOS for less than the cost of a competing hand held controller and you would still need to purchase amplifiers, other boxes, and install wires.

Even then there were critics claiming SONOS was expensive.  There were and still are potential users who view music distribution as a computer or phone extension and anything costing more than $100 is too expensive.

Physical media is not as important as it once was -- otherwise we would still have video rental stores. Video rental has retreated to a few video kiosks that I see here and there.

Also - with the caveat that I do not fully know the underlying reasons for this, so this may be anecdotal - it may be that Sonos architecture is more demanding of the robustness of the local WiFi network than devices like Echo are.

As an example: none of my Echo devices are on reserved IP addresses; all my Sonos kit is. Back in 2012 I found that providing these to Sonos improved music play stability while I never had to consider taking the effort to do this for just as many Echo devices that I now have, starting from 2017. Even with these running on the WiFi put out by the now antiquated Apple TC base station bought in 2011, that still does the job well enough to rule out premature replacement.

It is possible that the better approach now with Sonos to take full advantage of the latest home WiFi tech is to run it on WiFi as opposed to SonosNet - and the unresolved question in my mind is whether Sonos is able to fully exploit state of the art home WiFi tech as well as Echo devices seem to be able to.

My RF environment is busy enough I’m happy to get a FLAC ripped CD track to play. 

Since I can’t hear any difference in standard CD Audio and all these fancy new high-def formats I see no need for a system that supports them. I can’t see a reason to pay extra for music either, I’m into buying “fairy dust” that  I can’t hear.

If there is such a thing as a competitor for these Sonos rooms I have running I’d love to get a link to them.

ARC, Sub One SLs

Beam, Sub, SLs

I could probably find something to compare to my Play 1s, Play 3s or Five as far as speakers go but how well they’d sync and how many music sources fully support them would be a key pre-purchase question.