If this is a DataStream service then you may end up with some highly variable download speeds as the usual issue for DataStream is that the contention tends to be very real and noticable since it isn't economic to over provide on the VP's from the Exchange back to the center.
Also the explanation only really covers half the question.
As described they would certainly make savings on their upstream bandwidth costs, but the server hosting operation as described would not need the VP's to the Exchanges so all of that cost still has to be handled.
This has the feel of something that will probably start out really good, but as the VP's get more loaded and the heavy downloaders move in the service will probably get very slow for a number of people.
Also the explanation only really covers half the question.
As described they would certainly make savings on their upstream bandwidth costs, but the server hosting operation as described would not need the VP's to the Exchanges so all of that cost still has to be handled.
This has the feel of something that will probably start out really good, but as the VP's get more loaded and the heavy downloaders move in the service will probably get very slow for a number of people.