"Lifetime status" is a strategy to gain higher wallet share. Rollover nights, gifting status to others, etc. are similar strategies. It's all about incentivising their most loyal customers to stay more, by giving them reasons to. (at a conveniently low cost to Hilton)

Where Hilton made a mistake was giving lifetime status on its highest level of status. So once met, there's no reason to remain loyal.

Now that more and more LTDs exist - or are close to reaching the targets - and credit card Diamonds as well, a new level of status is required - Diamond Reserve. Although it will never be admittedly publicly, this is intended to reduce the value of being a Diamond or LTD, and ensuring that those still able to must aim for a higher level of spend/nights.

The one thing that nobody should ever ever believe is that Hilton (or any other hotel chain) truly cares about its lifetime status members, other than as a source of reliable revenue.