It appears to use S3 as its basic backend. My guess is that S3 has been modified to have "zones" of data storage that can be allocated for Glacier. Once these zones have been filled with data (and of course that data is replicated to another region) the hard drives are spun down and essentially turned off.
This is why the cost of retrieval is so high: every time they need to pull data the drives need to be spun back up (including drives holding data for people other than you), accessed, pulled from, then spun back down and put to sleep. Doing this frequently will put more wear and tear on the components and cost Amazon money in power utilization.
As is Glacier should be extremely cheap for AWS to operate, regardless of the total amount of data stored with it. Beyond the initial cost of purchasing hard drives, installing, and configuring them the usual ongoing maintenance and power requirements go away.
This is why the cost of retrieval is so high: every time they need to pull data the drives need to be spun back up (including drives holding data for people other than you), accessed, pulled from, then spun back down and put to sleep. Doing this frequently will put more wear and tear on the components and cost Amazon money in power utilization.
As is Glacier should be extremely cheap for AWS to operate, regardless of the total amount of data stored with it. Beyond the initial cost of purchasing hard drives, installing, and configuring them the usual ongoing maintenance and power requirements go away.