a) customers do not care what your costs are, they care what their perceived value is.
b) costs are cratering, to the point where costs at the margin are so small it is difficult to measure without counting out picodollars (don't use picodollars!)
c) low prices do not necessarily make customer acquisition easier -- prices are a signal (of quality and probable business continuity among other things)
d) businesses have care thresholds for money and all numbers under a particular threshold are identical. If for a certain group of customers the care threshold is $50 / month, picking any price below $49 is insane.
e) pathological customers are disproportionately attracted to the cheap options
f) if you compete on price, you're forever at the mercy of anyone who is either more efficient at cost structure than you or anyone who is stupid and willing to burn money going after your market