But this isn't just any online archival solution, it's Glacier, which is being positioned as a last-resort place for files.
Online storage services are useful for continual syncing, which using an external drive would be inconvenient for (if that drive was stored off site). Glacier is for files that you aren't likely to access again for months-or-years-on-end, unless there's an emergency or you're doing something bespoke, like making a family photo album and need to go back through all your files again.
So filling up an external drive and keeping it off-site and using Glacier is not as much apples and oranges.
(I'm the guy behind Arq) It's also useful as a second-tier backup. If you use Time Machine or SuperDuper you may never need to retrieve your Arq backups, but it's nice to know it's there in case your house burns down or somebody steals your computer + hard drives.
BTW, I'm not dissing on your product at all (and apologize for going off on a tangent). It could be that Arq is the glue that makes Glacier far more superior than any kind of personal storage solution. I'm just bickering about the cost of Glacier alone...but otherwise, I think it's great to have a Glacier-accessible option.
I didn't take it as a criticism of Arq. I wish costs were lower as well. On the other hand, I see there's a big difference between a hard drive vs bottomless storage that's remote, replicated, durable, and "always" accessible, so the cost doesn't seem so high to me. I've been of the opinion for a while now that the safest way to store bits is on spinning hard drives -- safer than DVD, tape, turned-off hard drives.
Online storage services are useful for continual syncing, which using an external drive would be inconvenient for (if that drive was stored off site). Glacier is for files that you aren't likely to access again for months-or-years-on-end, unless there's an emergency or you're doing something bespoke, like making a family photo album and need to go back through all your files again.
So filling up an external drive and keeping it off-site and using Glacier is not as much apples and oranges.