It helps that CDBaby was handling a lot of stuff that musicians didn't want to do themselves. They were happy to outsource it. If the alternative were easy, people would already have done it.

That wasn't what CDBaby lost to. They lost to the fact that CDs disappeared. CDBaby had a great business, removing a pain point, and they could genuinely want that pain point to go away entirely.

Such are the best possible businesses, genuinely caring about your customers while having enough moat to avoid being undercut tomorrow. Not all businesses can do that, regardless of the best intentions of management.