Many go even further and just give the product away for free for educational institutions and individual students (Github, Jetbrains and Tableau come to mind as examples)
I believe it's historically grown but it's not true anymore. More companies would use it if they could as this makes your processes way more automated, easier and more secure. Also more companies take security seriously (i.e. more and more companies get ISO27001/SOC2 compliant) but just can't afford the Enterprise prices.
Everybody deserves sso, regardless of size of company.
With the rise of micro services and DevOps, the number of applications used in an org has also exploded, adding even more reason to use SSO. Paying such big markup for every one of them is not sustainable for an SME.