There might be competition between pools but also costs for them to grow beyond a point which benefits decentralization - the issue at hand. What does it matte

There might be competition between pools but also costs for them to grow beyond a point which benefits decentralization - the issue at hand. What does it matter here if they have a harder time when none of them are incentivized to even grow to 1%? Even if they do grow, there's plenty of incentive for stakers to move to new ones on the spot. This might mean that e.g. pools will increase their costs due to the risk and stakers will earn a bit less but they still won't grow beyond a point.