1) Those aren't necessarily scam offers. You probably get a very low service and performance, and the company is betting that a lot of people will subscribe to their service because of the attractiveness, but then won't use it 2) At the same time they're betting on the fact that the price of hardware and bandwidth goes down with time, making your server less and less expensive for them, and at the same time power requirements go up for applications, making the server useless for you, so you'll basically stop using it. 3) If those bets pay, they stay in business and possibly charge for other, different plans. If those bets don't pay, they close and you lose your money.