"If you work for a 3rd party provider you know the worst is that it cost your employer whatever the SLA says and nothing else."
That's not true. If there is some major issue, I doubt the only issue a provider will have is whatever the "SLA says and nothing else." They will probably lose the business, account. The SLA is a minimum. It's not like Google said "we're not doing any back ups until further notice, have a good weekend"... they have a fix/solution in place, they're doing back ups, it's working. It just isn't automated... and, in theory, manual DBA intervention is slightly more risky than automation. It is also what pretty much everyone does on prem, manual or partially manual DBA back ups.
What the cloud providers do is a step beyond what any on prem provider would do... if Oracle or MSFT doesn't patch something in a timely fashion (just in theory :) and something goes wrong as a result, you are owed nothing and Oracle or MSFT will issue the patch when they are good and ready. They don't own *any* SLA... they are just dropping off code and, if there is an issue, they will fix it when they feel like it.
That is the part I don't get about people's concerns about cloud SLAs. They are concerned because now you are in the cloud providers' hands and their competency is paramount... but that is the case with on prem today. It's not like people are making their own servers and writing their own databases from the ground up. If there is an issue anywhere, you are basically on the phone with Oracle, IBM, Cisco, EMC, MSFT, etc waiting for them to get a fix out. Same situation as on prem as in cloud, but at least in cloud the provider owns the overall SLA and it is on them.