The hardware and bandwidth costs are only small parts of the full cost of running your own infrastructure. There are so many other benefits:
- you don't have to support your own low level services like Pub/Sub, Cloud Storage, Spanner, etc.
- you don't have to worry as much about things like HIPAA compliance
- developers don't have to wait for you to allocate more hardware, greatly slowing down the software development process
- it's much easier to test your applications, since you can spin up a full copy using rented infrastructure, and then throw it all away once your tests are complete
- many other benefits that I'm forgetting
And of course if you buy enough from them, you do get additional discounts.
For many (most? I don't have data) companies, the actual cost of the infrastructure and bandwidth itself is tiny compared to all the other "hidden costs".
- you don't have to support your own low level services like Pub/Sub, Cloud Storage, Spanner, etc.
- you don't have to worry as much about things like HIPAA compliance
- developers don't have to wait for you to allocate more hardware, greatly slowing down the software development process
- it's much easier to test your applications, since you can spin up a full copy using rented infrastructure, and then throw it all away once your tests are complete
- many other benefits that I'm forgetting
And of course if you buy enough from them, you do get additional discounts.
For many (most? I don't have data) companies, the actual cost of the infrastructure and bandwidth itself is tiny compared to all the other "hidden costs".