I think that's less of a huge difference when a small number of platforms dominate online media and aggressively use algorithms to determine or strongly influence what content people see. Yes, you can still absolutely find beautiful niche content on YouTube, and I value that a ton, but YouTube still has immense control over people's viewing in aggregate. It's a little bit like traditional broadcast TV if there were a billion channels but after every 3 minutes of viewing the TV chose which channel to flip you to unless you were constantly diligent about manually choosing what you want to watch.

Crucial to what? To making content "better", meaning more potent, more addictive, more alluring than real life?

I'd argue that broadcast TV was an okay middle ground, because if you were addicted you were a couch potato. Now, we are all couch potatoes but without the couch, and without the social opprobrium, or even the opposite!, the world is a generally worse place. I mean, I love 3blue1brown, but is he worth the societal cost?

You can sort-of achieve a poor man's "on-demand" by providing bazillion cable channels, but real on-demand delivers a qualitative difference: you no longer schedule your life around your TV, but watch at your convenience.