The per GB price on S3 is higher than on bulk HDDs. This is easily observed. What you are saying is your data storage needs don't even justify a single HDD. This is a scaling issue and not a pricing issue.
Oh, so “it’s more costly immediately” actually meant “it’s more costly once you’re storing over some threshold of data.” Ok. I can get behind that.
I don’t think it’s so easily observed at scale though, because at that point it’s hardly just the hdd cost anymore. It’s the hdd, server/compute, cabling, cooling, power, facilities, security, cabling, maintenance.
The TCO of data storage isn't just the drive - it just so happens that it’s still less than the cost of a drive up to some threshold. I don’t know if anyone having done a full cost model comparison. Everything I’ve ever seen assumes the data center is free.