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I get the feeling that lambda is only good for small apps..

Once request volume goes up, instances are much cheaper.

So lambda makes sense for hobby stuff and those small services that you only use occasionally. And then again, the financial motivation probably have more to do with maintenance cost.

It can be good for very bursty things too, particularly in the background. I process 'lots' of json on S3 using it. With no setup or anything complex I can churn through a a TB of json in a few minutes. Not sure on total time, but it's less time than it take me to sync the resulting files to my local machine. Running a thousand things at once for a few minutes is great.

Good news is with Azure Functions you could do consumption mode or pay for the specific hardware you need and run it either way.

It's the total number, sorry for that not being clear. We will make some improvements that may help clear that up.