You still pay that cost with your wallet, it's just hidden from you when you look at your code.
The main monetary benefit of serverless is that you can truly scale down to 0 when your service is unused. Of course, writing a nice self-contained library that fits into your monolith has the same benefit.
I fully understand serverless billing, which is why I told you its advantage: scaling to 0 for functions you almost never use. But if you are running literally ANYTHING else, you can get that advantage yourself: run your "serverless microservice" as a *library* inside its caller. You don't need the overhead of an RPC to enforce separation of concerns.
A small startup can pay $5/month to run a monolith on a tiny server commensurate with its use. It can scale that monolith up with use, from a $5 VM offering 1 core and a tiny bit of RAM all the way to a two-socket server VM offering 110+ cores and 512 GB of RAM. Alternatively, a large company can scale nearly infinitely with horizontal scaling. When I worked on a service with a trillion QPS and 50% usage swings at a mega-Corp, that's what we did. All our customers, even the ones with a measly 1 million QPS did the same. And their customers, and their customers, and so on.
"Serverless" was something sold to fashionable tech startups and non-technical people who didn't have the expertise to maintain the VMs/containers they needed. The serverless systems carried a huge price premium too. Everyone with true scale understood that there are servers there, and you are going to pay to manage them whether you want to or not.
serverless is s a huge boon to large enterprises who want to be more agile and not dependant on monolith architecture. the cost to them is a rounding error at best. a startup is a poor yardstick to measure serverless's benefits, if you can run on a $5 DO vps by all means you are not its target market.
They already run cloud VMs sharing CPU, the sharing already happens so why would it be somehow magically cheaper?
And how do you think they make money? Every second of a serverless architecture is probably 100s or 1000s times more expensive than a second of a traditional server.
Use your brain for 10 seconds, it's obviously going to be ridiculously overpriced for the compute you actually get. That's how they make money. And on top of that they have to do so much more orchestration and overhead to run it.
And bonus points, you're now locked into their architecture too!
If you have enough load to have a dedicated machine running at 10% CPU load on average, it'll be cheaper running a dedicated machine than anything else, you probably looking at old school VMs costing 2x more, cloud servers 10x more expensive and serverless would probably be at a minimum 20x more expensive.
The main monetary benefit of serverless is that you can truly scale down to 0 when your service is unused. Of course, writing a nice self-contained library that fits into your monolith has the same benefit.