You can have local models, but the vast majority of people are going to farm that out to a 3rd party provider via API calls because it's the easiest thing to do.
Remember I said "It all depends on how you implement it".
It all depends on how you implement it. He describes the text from images as using machine learning, which implies using an external API to do that translation.
Storing cloud backups requires a server and storage, etc.
Source: The sync ultra description from in-app
I might be mistaken, but I don't think Sync Ultra is the same thing as the ad-free sync premium. Sync Ultra is a subscription because it adds functionality that requires cloud resources, not just removes ads.
I think even more broadly, they want to encourage the harassment of anyone who goes outside their definition of what is culturally acceptable.
At this point it's like saying that water is wet.
It's more like realizing that you're surrounded by fire, so you might as well pick a patch with a nice view.
She's had years to train up a successor, at this point it's just blind power hungry arrogance.