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The servers are already bought; the electricity cost is negligible for actual accidents.

As mentioned in the post: the hosting providers don't actually pay marginal costs for transient mistakes, so neither should honest customers.

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And what about the extra costs fighting fraud now that they've advertised this policy?

We have to invest in fighting fraud and abuse anyway, such is the public cloud business. We don't intend to diminish user experience in service of fighting it.

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