This is already what happens. Your DNS queries have to go somewhere, and unless you control the DNS servers, there's a third party in the loop somewhere.
With TLS1.3, encrypted SNI, encrypted DNS the ISP can only see the IP address you are connecting to, not a domain name. For Google's resources it only sees that you are connecting to Google's network, but is it Youtube or Gmail or Maps, they cannot tell (which is awesome by the way).
And down the toilet goes the (distributing and caching) Inter-Net. Long live to the new Cloud-Net. Cloudfare and Google are achieving what Compuserve and AOL could not.
Exaggerating slightly ... but not that much really. And all in the good name of privacy and security.
It is also amazing how people (Americans ?) are not willing to admit I want MY jurisdiction to apply. Not an American one. I want the choice.
SNI isn't super useful to profile customers by itself. Now of course encrypted SNI will be a welcome addition to the protocol, but it won't get rid of traffic profiling.
The destination IP is more than enough to build a customer profile. It's not terribly relevant if you visited Youtube or Maps. Just analyzing netflow logs will give much more information than what services you use, such as for how long you use them and if you stream any media during that time.
Should you wish to have more information than that on your customers you'd have to buy it from someone who runs code in most web pages you visit. There are plenty of those, too.
Hence your request goes to yet another party: your ISP (by necessity via IP destination in your IP headers), the site you want to go to, and to Cloudflare/Google as DNS provider and as fourth party. Whereas with regular DNS, your ISP's nameserver gets DNS queries, hence only three parties are involved. Eg what ndidi, apexalpha said.
ISPs are highly regulated, as opposed to Cloudflare and Google. The only effect here is that Google closes another "loophole" in their view where web visit signals are send to another party (other than Google), and Cloudflare wanting their share of the cake as well. Has Mozilla disclosed what Cloudflare is paying them for being listed as default DoH provider?
Well to buy a domain you need to go to an accredited registrar for the respective TLD. And DNS registrations, renewals, etc. are standardized (and have TLD-specific policies). Also, you're entitled to transfer your domain name to another registratr, etc., also with a public and transparent protocol. The registrar will then arrange for their nameserver being registered as authoritative for your domain on the TLD's root domain server, etc. What's the problem with US ISPs here? That they're selling DNS query records (with your IP) against their nameservers? That's in the same territory as Cloudflare and Google, and will only stop with proper privacy laws; certainly not by giving up on the decentralized nature of DNS and giving all traffic/signals to Cloudflare/Google.
aren't you still sending your data to unregulated third party with any ISP? (i dont live in the US so i am not aware if they're regulated in this regard)