And then you grow by another 50%. If you go the commodity hardware route, you buy another 500 shitty $2000 servers. If you go the big-iron route, you buy another 2 $5,000,000 servers, because server price does not increase linearly with performance. If you're a big site, server vendors know they can charge you through the nose for it, because there are comparatively few hardware vendors that know what they're doing once you get up to that level of performance.

Look, if you're going to make the case that one should buy bigger servers instead of more servers, then this becomes an economic argument. The reason large web-scale companies don't do this is because it outsources one of their core competencies. When they scale horizontally across thousands of commodity machines, then knowledge of their problem domain becomes encoded in the scaling decisions they make and stays internal to the company. When they scale vertically by buying bigger hardware, then they are trading profits in exchange for having someone else worry about the difficulties of building really big, fast supercomputers. It makes life a lot easier for the engineers, but it destroys the company's bargaining position in the marketplace. Instead of having a proprietary competitive advantage, they are now the commodity application provider on top of somebody else's proprietary competitive advantage. If someone wants to compete with them, they buy the same big iron and write a Twitter clone, while if their server vendor wants to raise prices, it has them by the balls since the whole business is built on their architecture.

(I have a strong suspicion that Twitter would not be economically viable on big iron, anyway. They would end up in a situation similar to Pandora, where their existence is predicated on paying large rents to the people whose IP they use to build their business, and yet the advertising revenue coming in is not adequate to satisfy either the business or their suppliers.)