Earlier quoted context omitted.
Why? Having insight into website traffic is hugely valuable to webmasters.
They shouldn't have to feed information to Google -- they just need to look at the logs on their servers. Y'know... the way we did it before Google Analytics came along.
Requiring every website to create graphs and stats from log files is not practical, especially with websites that don't have a constant developer on it. Think blogs, recipe websites, restaurants. Google Analytics provides an insanely good value for them and it's a good thing.
It's not like pre Google Analytics we had a golden age of website stats.