Listen to the answer to the question,
"How long until our game installs take up 500 gigabytes of space":
https://youtu.be/tmfHxJT1I3I?t=7152sThe reality is a game has increasingly more content nowadays. Remember, there's a lot of "games as a service". So you have many "seasons" of additional content. You may not play all the content, but someone is. And when people want 4K and 8K textures, different variations so effects don't look the same twice, on top of all the other sizes, plus all the other effects ... it adds up. Never mind huge open worlds, where the asset footprint for just the map might be 100GB.
Having been in a few AAA studios myself (doing database stuff) and sitting next to artists and even art directors, the sheer amount of effort, headcount, etc. put into the art pipeline is genuine madness. In a large studio, art is over HALF the production cost, sometimes more towards 60-65%. Heck, one of the things sometimes brought up about Red Dead Redemption II is that there were three full-time employees in which all they were responsible for was horses. 6000 man-hours a year, on just horses.
To sum up what Chris said towards the end, "The only thing keeping these numbers down is the compression algorithms. If we didn't have these newer compression algorithms, we'd probably legitimately be at a terabyte. I can actually tell you for a fact, that there are over a terabyte of assets in the COD engine."