I don’t think it’s realistic to expect a free to use alternative to YouTube to exist...It simply costs too much in resources to store and send out high quality video content for free.

I agree, and at the same time I think this raises the great question of, why did anyone think it was a good idea to put all of this on a single site to begin with? Ideally it sounds great, courtesy of its convenience and...I'm sure there's more but I'm blanking on other qualities that don't seem to lean on presumptions of benefits from a singular site's operations.

Realistically it was almost always going to be a better idea to distribute the load of high density media like this across different operators to ensure a variety of video production, better redundancy through no single point of failure, reduced operational costs as a lower volume of data has to be stored & processed, and so on. Of course, the problem remains by & large the network effect in terms of getting any large group of people to disperse or move anywhere else, because it's not like there haven't been alternatives attempted, nor alternative technologies to enable alternatives to exist.

However, there's also the problem of any alternatives or competitors framing themselves as an alternative or competitor to YouTube to begin with. That's a losing approach from the start, instead they need to frame themselves as themselves, not a different YouTube, but an independent video host with xyz unique features.

If you don't believe that could be a successful approach, then you're simply ignoring the brief popularity of Vine and the rapid success and continuing popularity of TikTok.