The reason why we often "charge $x per GB after y GB transferred per month." is that this is simple and the customer can understand it. Usually the idea is that metering costs more than the bandwidth, up to a point, so you get a 'don't worry about it' quota, and then a punishing price after that. Me, I limit people after the 'don't worry about it' price, because, well, the sort of people who are my customer don't want to get hit by unexpected bills.

what would that look like if you had the 'don't worry about it' quota with a more reasonable price on overages? I don't know. It used to be that you'd set the 'don't worry about it' quota a little too high, 'cause with the unreasonable cost of overages, most people would error on the side of not using it all.

(metering costs more for both the provider and the customer, but mostly the customer; the provider side can be automated, so it's largely a fixed cost. The customer usually prefers a flat rate over a variable rate, even if the variable rate was slightly cheaper on average, because variable rate billing means that the customer needs to pay attention, which is expensive.)

When dealing with more savvy customers and selling amounts of bandwidth that matter, charging on the 95th percentile is pretty common.

That said, any major ISP who claims it costs them more than a few pennies per gigabyte to move traffic is flat out lying.