It's meant for orgs running at a certain scale, but you'd be surprised how early that starts making sense. AWS isn't exactly paying the economy of scale savings on to you.

True but at for companies operating at scale they not only operate on AWS but on other cloud providers as well as legacy data centers … but business wise it’s a hard sell , it may sell for couple of cycles to build a new dc or use an existing ones but then it will be back to the cloud again for many more cycles.

I've found that the scale these start making sense is only a handful of racks. We're not talking full DCs, but a room in a building or some colo space.

And beyond that, there's all sorts of weird environments that need a lot of local compute. You'd be shocked how many servers are on a cruise ship for one example among many.

Your business model is not the only one in existence.