People are touting S3, but you pay twice -- storage and transfer. Using the most inexpensive options with S3, a 1 gigabyte file (with reduced redundancy) with 1 download per month would run you $0.21.

Even without the one download this would still cost you $0.093 just to keep the file!

Let's ramp up and assume you have 1TB of storage and 250GB / month of transfer. How much is that?

STORAGE: 1000 GB x $0.093 = $93.00 TRANSFER: 1000 GB x $0.120 = $120.00

TOTAL: $213.00

I should note the above does not include any servers which will actually run the websites.

Lets compare this to hosting your own (ie - dedicated):

I have a 1.5 TB RAID-I server with 1.8 TB transfer per month on a 100MB port on a month-to-month contract.

STORAGE: 1.5TB RAID-I TRANSFER: 1.8TB

Total : $123.00 / month

It is a 8-core xeon with 4GB RAM -- I run a LAPP stack with 6 Cores dedicated to ffmpeg and image conversions. Waayyyy faster than cloud.

This is more of a hosting and infrastructure question. I recommend bringing this question to the community at webhostingtalk.com.

Yes, you will have to grow into these numbers, but that can happen pretty quickly.