Electricity is generally more expensive in Australia than US/Europe
Internet (consumer and business) is more expensive, huge area to cover with low population density
Most DCs are located in Sydney and Melbourne where rent/land and other costs are a lot higher than less populated parts of the country
International bandwidth is hugely expensive in Australia, everything goes by expensive undersea cables. While both the US and Europe have bordering countries where most of traffic is likely to go. Also similarly with local infrastructure, it's all owned by just a handful of companies who can strong arm providers.
Also in reference to your original question, it sounds like the VPS provider your using doesn't separate local vs. international traffic, so they're probably assuming most of it will be international and are charging on the higher end of the scale.
I think BinaryLane charges a bit less at around $1 per 10GB. There's probably cheaper providers out there but YMMV.
I have heard this quite a bit, but why is it hugely expensive for this reason? Is it because of the maintenance of the undersea cables or recouping initial construction costs?
- First world, bandwidth hungry nation.
- Low population to recoup costs from.
- Very low population density so transit across the country isn't super economical (related to above)
- Expensive to build transit because it's all underwater cable, no easy cross-border land-based fiber.