What I did:
Assemble random crap box from parts (Athlon 2100+, 512 MB RAM, 80GB HDD) This was free for me, and should be cheap or free for you. It was also two years ago, so you can probably find better hardware now.
Leave box at parents' house using cable modem for 2 months (free, but slow)
Co-locate box at Sprocket Data in Dallas for 6 months ($60/mo for 100 GB traffic, 100 mbps burst)
Then things changed a lot, but my startup has always owned all the equipment.
I like being able to fix problems myself when needed.
Because it's too expensive when you're just starting out. I could afford $60/mo, for instance (because I'm older and have lots of kizzash) but I'm hosted for $8/mo with 1.5TB of throughput.
If your site gets much traffic, you'll be over 60GB before you know it. :-o
And you're also in the dark about what those other processes (those not owned by you) might be doing at any given time.
Controlling the entire server as root is just better.
It's a great deal for static file hosting though, if you're a data intensive site as opposed to CPU-intensive site (or even a data-intensive site in addition to cpu-intensive)
Grew a site to 10k+ daily uniques while it was running over a DSL connection at my parents house!
Of course you're going to start at no less than $150 per month, and I spend almost $1000 a month, but.. this is business and you have to pay to get the goods. People who run their businesses on naff shared hosting are crazy unless they think the odd hour of downtime here or there is acceptable.
Of course, shared hosting or a VPS (my personal recommendation if your budget is small) is a good way to start, but once you make revenue, it's time to upgrade :)
VPN in your gateway box at home and it is almost like having the servers in the other room. They don't charge you anything for data that goes over the VPN, so you can upload/download from your server without using your bandwidth quota - it is a great for pulling off site backups.
Personally, I go with Dreamhost. The price is right, their service is awesome, and customer support is willing to help you with whatever you need. If scaling becomes an issue - then go looking for a dedicated host.
For 90% of the startups that launch, scaling will never become an issue.
And eventually we'll have Amazon E2 ... eventually ... and with that, you can control the (virtual) server and deal with scaling issues.
Any suggestions ?
The cheapest provider I can find offers the above for about $120 per month (with unlimited bandwidth).
They have a wide range of options, with several servers under $100 per month, but they limit bandwidth to 2,000 gb of transfer per month.
We find the 2,000 is a lot, though, (we've come close, but yet to go over), and you can control it further by using AWS.
Theye're very good value for maoney and the bandwidth limits are reasonable too.
256mb ram, 8Gib disk, 100Gib/month $20
1gb ram, 32 gib disk, 400gib/month $80
Wow, that's the best combination so far... they do skimp on RAM and HD size, compared to some of the others.
Is it too good to be true? What disadvantages or problems have other people seen?
Service? It's ok.
Totally unmanaged, so don't expect much on that front.
But I've had VPS's on three different physical servers with them and they were all starved for disk IO. They take quad core servers with 16-32GB of RAM but only put two 7200 RPM IDE drives in them. A 7200 RPM IDE drive is good for about 120 I/Os per second, so if the server has 20 users you get a whopping 6 I/Os per second.
Check it out:
$ time ls -l /etc /dev/null
real 0m12.530s user 0m0.004s sys 0m0.046s
12.5 seconds to list a directory with ~150 files. This is from a VPS account I have with them with nothing running on it.
To be fair, most VPS hosting probably sucks just as bad.
Good guys though.