A lot of the backend infrastructure can likely be reused, and by using javafog.com, rubyfog.com and so on, they can keep each brand/site independent without confusing end-users.
Yes, but if they keep the competitive pricing they now have, they could make a big bang in Rails space.
The industry is in a nascent state with respect to ruby and python clouds. Competition is always good.
Lucas was a leading developer at mog.com from the early days and more of a Ruby hacker at the time.