We pay a similar amount for HipChat, which is basically the same thing as Grove. Most of our users would eat up far more of the costs of just using a service like this dealing with setting up IRC clients, explaining IRC to them, etc. rather than just pointing them to a web app, which is far more familiar.
The problem is, "hosted IRC" is a ridiculously bad marketing strategy. IMO, Grove should view IRC as a backend implementation detail, and not any part of their public offering. The only people who are going to care that Grove is backed by IRC are exactly the people for who hosting an IRC server isn't a big deal for.
Because some businesses just won't use a public IRC server for various policy reasons (including policies required by their own customers), while using a paid server from a third party could be accepted.
* With some legal or contractual obligation preventing use of a public IRC server.
* But not preventing use of a third-party outside-the-firewall solution.
* And not having any criteria for the third-party, such as HIPAA compliance, warranties/guarantees, etc.
Seems a pretty small set...
Interestingly, grove doesn't seem to promise not to disclose the archives of your "private" server at all. Lots of ass-covering in their Terms of Service in favor of grove, and they have a privacy policy pertaining to their website, but nothing I could find about not telling the world whatever you happen to send their IRC servers.
They are just "outsourcing" the low-value stuff in favor of their core business.