It really seems like you are using spurious accusations of impropriety to deflect from your actual point being bad.
We are comparing to T1 ISPs because they also provide huge amounts of bandwidth reliably, and they do it 3 orders of magnitude cheaper. Therefore it cannot possibly be the case that providing the bandwidth is simply that expensive.
Again, these egress fees are not paying for egress alone. They are defraying the cost of operating a massive, complicated, low-latency, reliable cloud network infrastructure, much of which is free of charge when used internally.
Some, like you, are expecting that cloud providers operate on a “cost plus” model where what you pay is strictly based on what marginal costs for the same thing. But it’s not that simple in reality. Charges levied for one thing can be used to pay for another.
The bandwidth itself? I’m honestly unsure as I don’t know how AWS’s interconnectivity and total bandwidth compares to Arelion. But it’s still the wrong question to ask.
I think it’s “am I getting the value I expect for the price I pay?” If it’s not for you, that’s fine. But for others, it’s worth the cost. To them, they’re paying for more than mere egress bandwidth.
So basically it's good as long as the consumer surplus is greater than zero, regardless of how the consumer surplus stacks up against the producer surplus?
If it's surplus it's not costs. Why did you claim that the high price is to cover the costs if 99.9% of it isn't covering the costs?
If I may take the opposite view: companies should be grateful to get any profit from me at all.
> If it's surplus it's not costs. Why did you claim that the high price is to cover the costs if 99.9% of it isn't covering the costs?
I edited my comment above to explain in more detail what these charges are covering (and it’s not egress bandwidth alone). This has been a fast moving conversation and I’ve tried to add more context, unfortunately after the fact. My bad for posting too quickly.
It's funny that you say they are shifting costs around when AWS in particular is notorious for not doing that. Every individual thing they provide is metered and profitable.
If you're suggesting they really do have 1000x the costs of companies whose core business is internet, and yet they refuse to contract with those companies to deliver the service (they can still get 990x profit while still leaving 10x for the other company) in a rational market that would be a business-ending level of incompetence.
It's no different than if I'm selling apples for $1000 each. Even if I can find one or two customers willing to pay that, wouldn't I have to be pretty stupid to spend $900 growing each apple incompetently when I could just spend $2 at the grocery store to fulfil those orders?
I’ve done the best I can with limited time and space to explain it here. If you still don’t understand or don’t care to learn how cross-subsidization works and the costs and business model of operating a tier 1 cloud provider and how they differ massively from operating an ISP, I don’t know what to tell you. Getting a job at one of these companies to gain that experience would be eye-opening for you.
We are comparing to T1 ISPs because they also provide huge amounts of bandwidth reliably, and they do it 3 orders of magnitude cheaper. Therefore it cannot possibly be the case that providing the bandwidth is simply that expensive.