Gridseeds are profitable because you piggy back on your own internet connection that you pay for as well as the space you already have. Go rent a space and set up a separate internet connection for it and see how profitable they are.
Completely false. Bandwidth and space expenses are miniscule due to the massive power densities of mining equipment. Amps and cooling is what it's all about. Scrypt Hashlet maintenance costs are 3-4 times above reasonable colocation costs, so if they can't do it effectively themselves they should have outsourced it long ago and shared the savings with their customers. Why didn't they? Win-win-win for everyone involved.