In general it is not expensive. In most cases you can either load balance across two regions all the time or have a fallback region that you scale out/up and switch to if needed.
Multi tenancy is expensive. You’d need to have every single service you depend on, including 3rd party services, on multi tenancy. In many cases such as the main DB, you need dedicated resources. You’re most likely to also going to need expensive enterprise SLAs.
Servers are easy. I’m sure most companies already have servers that can be spun up. Things related to data are not.
You wrote "You’d need to have every single service you depend on, including 3rd party services, on multi tenancy.". This is highly incorrect. I worked at several companies that have a multi tenancy strategy. It is:
* Automated.
* Scoped to business critical services. Typically not including many of the 3rd party services.
* Uses data replication, which is a feature in any modern cloud.
* Load balancing, by DNS basically for free or a real LB somewhere on the edge.
If you fail at this you probably fail at disaster recovery too or any good practice on how to run things in the cloud. Most likely because of very poor architecture.
>> Redundancy is insanely expensive especially for SaaS companies
That right there means the business model is fucked to begin with. If you can't have a resilient service, then you should not be offering that service. Period. Solution: we were fine before the cloud, just a little slower. No problem going back to that for some things. Not everything has to be just in time at lowest possible cost.
Are customers willing to pay companies for that redundancy? I think not. Once every few years outage for 3 hours is fine for non critical services.