A. You are right, you don't have to pay someone 1% of management fee to manage your portfolio.
Data from Cerulli suggests that a large number of financial advisors may not be providing much value-add; about 9% of the roughly 300,000 advisors in the US do nothing but manage portfolios, and at the other end only about 26% provide full comprehensive financial planning advice. The fundamental point is that the pressure is rising on advisors charging 1% on AUM to justify their value proposition, and while some may still be able to do so, others may not be charging a fair price for the services actually being provided.
The Wall Street Journal had an article recently - The Incredible Shrinking Management Fee - it profiles WiseBanyan, the most recent entrant to the "robo-advisor" world that offers to provide investment management services not just at an ultra-low cost, but entirely free, with no minimum account size, no sign-up fee, and no cost to buy or hold the investment portfolios (which are comprised of low-cost Vanguard ETFs averaging 0.14% in expense ratios).
Can WiseBanyan survive without charging a fee? After all, if it's not WiseBanyan offering the service for free, it may be Wealthfront or Betterment, which only charge "slightly" higher fees of 0.15% - 0.25%.