This post misunderstands why the journal system exists, and why they work this way. It is not because there is an evil corporation controlling everyone else.
Universities do the research. They voluntarily choose to pay for and publish in journals. They could just decide not to do this. Literally, just don't publish in a journal, anymore, ever. Upload your study paper to a Dell Inspiron sitting in a closet in the university faculty lounge, connect it to the internet. Done. Why don't they do this?
#1. No guarantee anyone will look at it. You just spent years of time and money to come up with a research conclusion. Will anyone read it? Comment on it? Learn from it? Is it any good? Will anyone review it? It's after all just a paper sitting on a server. Without some kind of process to vet it independently, and publish it in a place where people can find the latest vetted papers, it's too much hassle for most people to ever find, much less trust.
#2. The reputation feedback loop. Universities give research grants to "well respected" researchers. You become a "well respected" researcher by having academic achievements. You get academic achievements by... doing research that gets published in a journal. Universities depend entirely on the prestige of the researcher and journal to decide who gets a grant. Because...
#3. Money is hard to get. In order to convince someone (government, private donor) to give your university money, you have to show them it's worth it. And the way they show that is.... the prestige of the researcher, being published in the prestigious journal. Look, we have cool peeps, publishing in cool journals! Give us more money!!
Therefore, the reason journals still exist, is Universities desperately need them. They don't want to pay an insane amount of money to a journal. But they don't really have a choice.
Could Universities replace journals with something else? Well, they could work hard to replace the "prestige machine" with other processes (which must enable them to get money, by showing their researchers are good, with vetted papers, published somewhere people will see them). They could replace the journal system with their own intra-university system. But it turns out, that costs a considerable amount of money, time, and resources... which is entirely what the "evil journal publishers" do. Universities would have to spin out their own entire corporation to do all that work, which would be a journal publisher. They know this is expensive, difficult, time-consuming, and they also know the existing system benefits them.
"Let's just throw papers on arXiv" does nothing to solve the money and prestige problem. So the world continues to turn as it has.