If you are in the United States, ISPs are largely unregulated and charge whatever the fuck they want. They make ridiculous profits.

Many other developed countries have dramatically cheaper internet access with significantly higher speeds.

American residential internet prices are a fucking rip

But also. VPNs do not need to worry about the "last mile", I.e. infrastructure to your house, which is most of the cost of your residential service.

With an ISP, you are not paying much for your bandwidth to the Internet. You are paying for connection between your house and their office. Your ISP has to maintain many miles of wire across your city. They also need to maintain equipment that can handle thousands of individual connections across many individual wires.

In comparison, a VPN provider just has a couple of very big connections going into their data center for pushing data in and out.

Plus, you likely have only a few choices of ISP (or only one choice), so your ISP can maintain a very healthy profit margin. With VPN providers, there is a ton of competition, so they have to charge you only a little above actual cost.

ISPs only cost like $10 a month to run.

VPN providers have to manage less hardware

Unlimited 100 Mbps internet costs around $5/month where I'm at

Commercial data centers. Auto scaling infrastructure and just sheer scale. At $2 it may be at cost or a loss to generate future sales.

Others have given plenty of good reasons. But on top of that they'll make money from all the people paying for the subscription but currently not using it, like any subscription service does. Most users won't use their vpn 100% of the time

You're paying for the last mile, they probably aren't. VPN's can probably get away with servers near major Internet nodes.

VPNs are basically free to host. All you need is one server and you can put hundreds of people on it if you really hate them.

ISPs have to actually run cables to your house, to other nodes, sometimes pay to route traffic through certain connections.

Also most cheap/free VPNs are either stealing and selling your data, or using your network as a VPN for others.

I'm sure you are far outweighed by users like me who keep one for when traveling away from home and working in public spaces (i do two days a week on average). Most days is no bandwidth and when there is usage its pretty low as limited to the public WiFi so just syncing files for local changes and general internet use / research. I could do and sometimes use a VPN to my home server but I don't want the risk I can't work anywhere if something happens.

If I’m putting the major bulk of my traffic over a tunnel that could eat up a sizable chunk of a given connection point for the provider that I’m sure costs more than $2/month to maintain. I would have to assume it would take the combined subscriptions of several users to pay for a given node.

Most VPN users do not saturate their connection the entire time. Which means they can overload their nodes.

They also have fatter pipes and dedicated hardware that allows them to handle a lot of traffic from many different endpoints.

Aren't they just spoofing your address? I never thought they actually had any infrastructure.