Well the difference here is that a utility is a natural monopoly. It's not under market scrutiny except for regulators. Linode is under intense pressure and it's been lagging behind competitors for a while now

I've found Linode rock solid in all the time I've used them. But I've also found them a bit slow in adopting features that are important to me (this and SSD storage)

I don't think those two are comparable. Computing is known to be cheaper over time due to Moore's law, but you can't equate gas/electric/water the same way as there are other factors (population, demand, supply) that weigh in. Hopefully more innovation into alternative electricity (solar) will help with part of it. Another factor is inflation such as employee wages to maintain water supplies could increase the end cost to consumers.

Unfortunately, I learned the Linode Metered Billing doesn't work this way (see my comment above). Basically, you're billed for the number of hours that a server is on your account, not your actual usage of the server. So, the more or less you use of a specific server doesn't affect billing. It would only affect billing if changes in usage meant changes in the number of servers on your account. Maybe obvious to some, but wasn't to me.

The analogy for electricity (with Linode Metered Billing, in comparison) would be adding or removing electric supply lines and/or meters vs. actual usages as measured in Kwh.

This billing system probably wouldn't work if all of Linode's customers tended to spin up more servers at exactly the same time, which is what utilities deal with when e.g. it's a heat wave. They need the infrastructure to support the peak load, even though it's quite a bit higher than the typical load.