What role does an SMTP Server Provider play in improving email deliverability?

I’m trying to understand how outbound email delivery works for websites and applications that send transactional or notification emails at scale.

Many platforms recommend using an external SMTP Server Provider instead of relying on a hosting server’s default mail function. From a practical standpoint, how does an SMTP server actually help improve email deliverability and reliability?

In particular:

• How does SMTP infrastructure affect inbox placement?

• What benefits does an SMTP provider offer in terms of authentication, security, and performance?

• Are there specific scenarios where using an external SMTP service becomes essential?

I’m looking for general, educational insights rather than promotional recommendations, especially to better understand how email delivery systems work behind the scenes.