I'm not in the cloud computing business, rather, the utility business. But at a glance it seems quite similar: you invest in capital and make your money a few cents a minute over a relatively long period. Costs are relatively granular and so you get more for more usage.
With that said, don't you want steady, consistent usage selling a server? I'd guess for exactly the same reason as a power plant, nobody wants to own a server that cranks up 2 or 3 hours a day... unless they absolutely HAVE to, to provide their service.
I don't mind owning a server (or a power plant for that matter) that only operates a few hours per day, as long as the price I get paid for those hours is high "enough" compared to the risk on the investment.
The problem is, of course, that at the prices needed for that most consumers will no longer be interested in buying my computing services or power.
With that said, don't you want steady, consistent usage selling a server? I'd guess for exactly the same reason as a power plant, nobody wants to own a server that cranks up 2 or 3 hours a day... unless they absolutely HAVE to, to provide their service.