Explain to me why the gaming industry needs one company to be vastly more powerful and influential than all the others combined, or the industry collapses, when that isn't the case with every industry? Why does the TTRPG market have to have WotC lording over all so very much?
It is not the gaming industry it is the table top roleplaying industry and it does not really have to be WoTC, they are just inheriting the prime mover effect from TSR because they bought TSR's IP before it got replaced by another in the market.
it could just as easily have been Traveller or GURPS.
As for the network effect, this works in a number of ways. Given that D&D (some official version) is the biggest game in the market by far, if ones first exposure to ttrpgs is an introduction by someone else then that some is more likely to introduce you to a version of D&D. Which directs you to the current version of D&D when you decide to buy some actual material.
If one goes to seek players having heard of the ttrpg concept some other way one is more likely to meet and play with D&D players than some other system like FATE or whatever.
Even if one started out with some other system like Runequest but that group breaks up one may have a lot of trouble finding other players up for that system but D&D players are much more common, and so on.
Now if D&D had died with TSR then right now there might well be a company that is not WoTC and not D&D dominant in the ttrpg market and in my opinion it would be just as dominant as WoTC even if the market was not as big.
Now if WoTC shuttered and died right now, it would be my guess that in 20 years the dominant rpg would have been some flavour of D&D, given its current popularity, its influence in the fantasy genre and the existence of open source chassis for the game.
I think, however that the ttrpg market will always be dominated by a system because whatever system that is easiest to find players will be the dominant system and that dominance will be very difficult to overthrow.
The only way I could see D&D's dominance being overthrown, at this time, would be the emergence of some cultural phenomenon that promoted roleplay that arose outside the gaming world and got big enough to be fad.