Bandwidth is one of the things that gets significantly cheaper at scale. For most users, if they call a wholesale bandwidth provider the rates they get will be more than what a public cloud provider will offer. So it looks like a good deal. That's much more true than with something like hardware/compute where the differences between what you can buy a server for and what a big cloud provider can is less extreme. That's not to say Amazon or Google can't get better deals on servers than someone who just phones up Dell, but it's nothing like the savings you can get at scale on bandwidth. What's been interesting is how little competition there has been between the different public clouds on bandwidth pricing. That's starting to change and I'm proud of how we've pushed that at Cloudflare with things like the Bandwidth Alliance (https://www.cloudflare.com/bandwidth-alliance/). Oracle's cloud is also pushing on this (see Zoom's comments on why they chose the Oracle cloud). If you saw the margins that AWS gets on bandwidth you'd throw up in your mouth.
I find this comment rather confusing under an announcement for Workers Unbound, which charges $0.09 per GB. That's AWS/GCP/Azure-level pricing, and definitely does not push competition on that front.
> If you saw the margins that AWS gets on bandwidth you'd throw up in your mouth.
Presumably the thinking behind this approach is that it allows them to advertise cheap instance costs and storage costs, while still making bank, assuming the customer's traffic volumes are non-negotiable?
Also has the effect of lowering prices for casual dabblers, who might want to play about with what's on offer without moving much traffic.
If you're selling hosting, you can either sell CPU at close to cost and make money on bandwidth, or make your margins on CPU. If people are building things that don't stress the CPUs at all, you can load up servers and make ~$60-70/mo margins on CPUs.
When they expect dedicated CPUs and memory, they're suddenly going to price shop across cloud providers and won't pay enough to make those same margins.
