I'm sure latency matters a lot as well.
The users of our apps are pretty tolerant of 5 to 10 minute request times for some of our pages, which means we've been able to get away with just a few servers for several TBs of data stored and served. (100+mb responses are not unusual for us).
If we had to rethink and redesign the system to cut down those times, we'd need a lot more databases and a much cleverer storage strategy than we currently have.
While I'm sure response time for Reddit is really important, I could imagine that an IOT serving system needs almost nothing in to hit something like a 10 to 20 second response time for 5k devices.