Plus the supposed savings of in-house hardware only materialize if you have sufficiently managed and queued load to keep your servers running at 100% 24/7. The advantage of AWS/other is to be able to acquire the necessary amount of compute power for the duration that you need it.

For a large university it probably makes sense to have and manage their own compute infrastructure (cheap post-doc labor, ftw!) but for smaller outfits, AWS can make a lot of sense for scientific computing (said as someone who uses AWS for scientific computing), especially if you have fluctuating loads.

What works best IMO (and what we do) is have a minimum-to-moderate amount of compute resources in house that can satisfy the processing jobs most commonly run (and where you haven't had to overinvest in hardware), and then switch to AWS/other for heavier loads that run for a finite period.

Another problem with in-house hardware is that you spent all that money on Nvidia V100's a few years ago and now there's the A100 that blows it away, but you can't just switch and take advantage of it without another huge capital investment.