Answer
AS400 hosting makes more sense when the business wants the IBM i workload to keep running but no longer wants to own the next hardware refresh, server room upgrade, backup infrastructure, or after-hours infrastructure support burden.
A new on-premises Power server is still the better fit when the team has strong internal administration, tight latency requirements, existing data center capacity, and a long runway for owning the platform directly. The decision should compare operational ownership, not just monthly hosting cost against purchase price.