I think the issue is that these service providers are more than capable of providing "unlimited" data, but choose not to because they can make a lot more when people inevitably go over their limit. The salt on the wound is the fact that ISPs usually have no competition. They usually have a monopoly on the area in which they operate.

Where I live, we have unlimited data that only gets throttled if you use a truly absurd amount (like if you're constantly pirating large amounts of 4k movies or something). No caps or unexpected fees. Overall, I always felt like I had it pretty good, and I still think that...mostly.

The funny part is that my ISP had competition move to town recently. I kid you not, the week before the competition officially started up their service, my ISP sent a letter saying they were doubling my Internet speed for no extra charge.

They were trying to show how awesome they were but really it was the biggest slap in the fucking face. You're telling me you were overcharging me that much for years?

Another issue is that advertising, which you never asked for, makes up part of your monthly data usage, as do routine and unavoidable downloads like security updates, video game patches, etc.

There isn't much difference at all. Neither should have a cap.

Data moving across a network doesn't have any per-unit cost to the people operating the network. Whether you use 5TB or 5GB doesn't impact the bottom line of the ISPs at all.

The only justification for a data cap would be if they've overprovisioned their network and sold too many people plans that are too fast for their network to support, so they need to disincentivise people from actually using it. Even then that's pretty shaky justification.