Earlier quoted context omitted.
If you log into accounts from your phone, that's also 1fa in the same way. And if you keep your phone in the same place as your laptop, so it can get stolen at the same time, that's also effectively 1fa. The threats that TOTP protects against are ones that don't involve losing your device. For example, if somebody breaches a password database or phishes your password, TOTP codes prevent them from using the leaked cre…
It depends on the phone, but for many phones the security story remains very good even when lost, unless someone knows your passcode. So it’s still “something you know” protecting the password and the TOTP code, but it’s different things that you know and strict rate-limiting on the phone side that wouldn’t be possible on an internet-exposed authentication system makes it extremely difficult to guess the phone passco…
It’s Microsoft that’s stuck in unsafe grounds, and it’s partly the cultural apathy of their user base that’s at fault.