Like anything, it’s a trade off. The fact that you can do whatever you want is the good thing. As long as everyone isn’t in the same datacenter, it’s fine. There’s datacenters all over the planet.

If you’re self hosting, you can mitigate the risks by having some kind of contingency plan though. Just having backups in another location would have made it possible to get back up after the interruption. Now, this instance is probably just screwed.

Data centers aren’t inherently bad and neither is self hosting. But there’s different risks that need to be planned for.