I always come down to this question on cloud mining and ROI. Why would any cloud mining operation let you make a positive ROI? They would be better off just mining for themselves. So why bother participating?
One advantage for a vendor selling their mining capacity is that they don't have to wait for their ROI, it brings in instant capital and profit for them. This can then be re-invested into the next generation technology.
This in itself wouldn't be so bad if the purchaser actually made a profit, but as anyone with a calculator can see this WILL lose you money. You then compound the problem because the vendor gets lots of new hardware that raises the difficulty and further erodes your return.
It's like renting miners....you are always going to pay more in than you get out in coin. The only possible reason would be that you are going to sit on your coins until they appreciate. But then why not just buy them?
As you can see from my sig, I rent my miners. People have many reasons for wanting to hire short term extra capacity, the most frequent is to mine new coins when the rewards are at their best, some pool operators hire them for testing or to help with a stubborn block, some like to gamble and mine on bitsolo in the hope of a nice payday (and it has happened), people get rid of their alts, the site I use accepts credit cards, I'm sure there are more
