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Yes, but for companies like Google, the vast majority of systems administration and SRE work is done over the Internet from wherever staff are, not by someone locally (excluding things like physical rack installation or pulling fibre, which is a minority of total effort). And generally the costs of bandwidth and installing hardware is higher in places with a smaller tech industry. For example, when Google on-sells their compute services through GCP (which are likely proportional to costs) they charge about 20% more for an n1-highcpu-2 instance in Mumbai than in Oregon, US.
Would you say its unfair to base pricing on any attribute of your customer/customer base? I haven't seen much discussion around how to fairly set prices for any kind of service/good. Seems most people agree they should make a profit of some kind, and I've heard some rough rules suggested but it almost seems like the logical conclusion is that prioritizing profit is always bad for society.