I wasn't there for it, but this opinion piece has a pretty good story about the whole thing. https://ploum.net/2023-06-23-how-to-kill-decentralised-networks.html

Basically, once Google had most of the regular users, and had convinced many of the XMPP users to switch to them, they just cut off support for xmpp, effectively neutering any growth it may have had without their influence.

To compare that to webp, it would be pretty easy for them to fork their webp into a closed source "2.0" and most everyone would be switched over to that version without even having a say in it. Sure, original WebP would still exist, but since nobody uses/supports it, it's basically dead in the water anyways. This sounds awful and unlikely, but it's literally in their playbook, and it is a thing they have done several times. Android, chrome, XMPP, etc..

It's just as likely that Google keeps WebP as open standard for all time as it is that Google remakes it into a closed source tool that only their closed systems can use. The fact that they have a history of being awful is why we need to keep competing standards around, even if they're just not as good or as widely spread around.