Different cards offer different reward structures. I currently have sixteen (16) credit cards, but I'm certainly an outlier.
For everyday purchases I use one card for restaurants and gas, another card for groceries and yet another for everything else. Then two other of my cards have rotating bonus categories, so I may use one of those for gas one quarter and for restaurants next quarter.
And, at minimum, you should always have a backup, like a sibling comment points out. Especially when travelling, you don't want to be in the middle of nowhere trying to buy meal only to find out your card has fraudulent transactions and the new one has to be mailed to your house.
Depends entirely on the card! Annual fees can be either $0, as small as $30/year, or as high as $500/year (AMEX Platinum) and up. AMEX Centurion is invite only, it's for millionaire high spenders and has a $2,500/annual fee. Barclays Luxury Card is open to everyone and I believe it has a $900/year annual fee.
Some cards waive the annual fee the first year and some don't. It's whatever the card issuer decides makes them the most money.
Personally, I pay two annual fees and have a third one waived for now. Some of the cards I have I've downgraded to the less benefits no annual fee version of the card after collecting the annual fee version benefits for a year.
Many, many cards have no annual fee. The ones that do, are usually worth it for the right customers- e.g. a travel card that comes with a lot of actually-valuable travel perks for the frequent flyer.
Credit cards with an annual fee simply for the privilege of having a credit card, are mostly gone, chased out of the market much like the takeover of free checking.
It varies. I don't have anything like 16. But I have a couple of cards with specific reward benefits that I pay for plus a number of free ones for benefit and other reasons.
3) Restaurants. This is the only use-case where my card is out of my possession, and I try to isolate that.
4) MOST on-line purchases (Except for #5 below)
5) Online subscriptions. These are things like DO or AWS or month-to-month Jetbrains or Safari. This makes it easier to visually scan the statement for things that should not be there, or are wrong. (Billing mistakes are not infrequent).
6) Business expenses. This makes either submitting expenses and/or taxes easier, because it's all in one place.
Different cards offer different benefits. At a minimum, I want to have one backup in case I leave one at a restaurant or something wonky happens with fraud systems. So, yeah, I have multiple cards although I mostly only use two of them.
I don't know a single person with more than one credit card. Why would you even need more than one credit card?