The one resource you won't get any more of from any cloud provider by scaling vertically, is network latency. (Because with most cloud providers, you've usually already got the fastest link you'll get for an instance, on their cheapest plan!)

Given the same provider, ten $50 instances can usually handle a much higher traffic load (in terms of sheer bulk of packets) than a single $500 instance can.

Alternately, you can switch over to using a mainframe architecture, where your $500 instance will actually have 10 IO-accelerated network cards, and so will be able to effectively make use of them all without saturating its however-many-core CPU's DMA channels.