It's about fast scale-out. If you are getting that kind of sustained traffic, then you can likely pay for the conventional hosting.
The problem is what happens when you have normal trafic but get spikes? The NY Times links to your startup one morning and suddenly you have hundreds of thousands potential new customers kicking the tires at the same time. You'd like to be able to handle that easily, so you can convert some small % into paying customers and take advantage of the free publicity. But if your site goes down in flames you give a bad first impression to all those potential sales, and they will likely never give you another chance.
I agree but still think that's possible with the quota (before you request an increase).
In an eight hour period (the work day), 500 requests per second is enough to serve 1 million people 17 GETs. And the vast majority of people will bounce away after one page view.
So unless you cured cancer or something, I wouldn't worry.
The problem is what happens when you have normal trafic but get spikes? The NY Times links to your startup one morning and suddenly you have hundreds of thousands potential new customers kicking the tires at the same time. You'd like to be able to handle that easily, so you can convert some small % into paying customers and take advantage of the free publicity. But if your site goes down in flames you give a bad first impression to all those potential sales, and they will likely never give you another chance.