This is mostly wrong.

Localization are usually handled by external teams. Cybepunk 2077 has 11 spoken language options, and 18 text languages. No development studio has writing staff fluent in that many languages in house. The only practical way is to outsource to a different team for localization. Major publishers will usually have their own localization teams, but many developers hire external contractors to localize.

CDPR was in the news recently when their Ukranian localization team went rogue, adding commentary on the ongoing war in Ukraine. They were clear to point out that this wasn't the work of CDPR, but decisions made by the external studio they hired.

The reason for the change has much more to do with the fact that international trade and communications have become easier. Games are sold by international stores like Steam, and the builtin store on consoles. Releasing your game to an international audience is basically trivial.

In the age of physical media, releasing internationally was a major expense. Selling media in physical stores requires local knowledge and local capital and warehouses. Most companies didn't have that, so they would sell the distribution rights to a local company. The distributor would do the localization and would own those rights. This wasn't just games. This is the reason for weird international availability on streaming platforms, because some local companies still own the exclusive distribution rights of films and shows in certain countries.