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Deluxe Dedicated Server (closest to amazon's server):
500GB bandwidth + 240GB disk = $150/mo
S3 costs would be 500 * 0.2 + 240 * 0.15 = $136
EC2 costs would be $0.10 * 30 * 24 = $72
Total cost = $208/mo
And Godaddy is one of the more expensive dedicated servers. I wouldn't go to amazon for the price, but for the quickness, customizability, and scalability. Which are probably the most important aspects of hosting.
Yes, the hard number cost compared to godaddy are more expensive, but the point is that you only pay for what you use. How many people do you think are using their 500GB and 240GB at godaddy? 1%? 0.001%?
What if you're only using 20GB bandwidth and 20GB disk space on godaddy/EC2?
20 * 0.2 + 20 * 0.15 = $7
I think this is a much more likely scenario for godaddy customers.
John