Depends on your budget, right? But if it's not non-existent, then I'd recommend SoftLayer (just Google for 'softlayer'). They're formed out of the ashes of the old, and great, management team from The Planet (before it kinda went 'eh') and are good value and really progressive (extremely customizable machines, cheap upgrades, virtual private LAN for all users, KVM for most servers, IPMI logins, open API to control your servers, etc). I moved to them from EV1 several months ago and am totally in love. It's amazing for startups because they offer datacenter level options for dedicated hosting money (it's worth it for private LAN alone, I save tons of bandwidth).

If you want more general comments, rather than specific vendors, then... unless your site is entirely local/regional, then always host in the US. Always go for something that's not the cheapest, but not the most expensive. Always search WebHostingTalk.com for reviews of the company you consider.

I wouldn't necessarily opt to host in the US. I wouldn't host in Poland, but certainly Canada is an option. As a Canadian myself, I've been trying to avoid the US actually, since I'd rather not have my systems be subject to the PATRIOT act.

If your server isn't in the States, it is easier for the USA to spy on you. They don't need the PATRIOT act; they don't need to ask at all.

I want both kinds of comments :-) SoftLayer give a good impression indeed. Dare I say I didn't know about WebHostingTalk.com before...

Regarding my fear for the legalese, I suppose I need to see what kind of terms of service other startups are willing to bear and go with those until I can hire a lawyer to get proper interpretations. In any case, SoftLayer terms of service seem to give a healthy amount of rights to the customer too.

Now that I need hosting for an application, I don't even know whether to go with the cheapest virtual hosting or try to go directly for some better-grade setup.

Amazon S3 can be used for most of the storage needs, but I'd need a lot of RAM for good price. Server Axis virtual servers seem good this far.

What about service-level agreements and terms of service of various providers, all I've seen would seem to leave a lot to be desired?

IMHO the best thing to do is to take a cheap housing. Here in Italy where prices are much higher than in the USA you can get a decent host with a big disk, few GB of ram, 1Mbit of guaranteed bandwidth for 100 EUR / month, including the price to hire the server.

It's very important to have a good Linux distribution like Debian or Ubuntu where you can install/upgrade things in few seconds with apt-get.

Also it's important to have root to be able to install different apache modules, install cron jobs, be able to manage the firewalling in case of attacks (I saved myself from a DOS thanks to a Tcl script + iptables one week ago).

Virtual servers are cheap but the performance may not be bright.

p.s. I suggest to use a very low TTL for your DNS records so you can switch ASAP if there are problems. Also to try to "packetize" your application is important in order to make sure you can install without too much problems your code in a different host in little time.

Actually, I've found the performance of my Xen VPS much better than a dedicated server at The Planet. Most likely that's because the dedicated server had just one IDE disk and the Xen host has a fast SCSI RAID array. Dedicated hosting gets pretty expensive when you get into SCSI drives and RAID but it's really important to consider your performance and reliability needs.

Thanks, there we've got several suggestions wrt. vendors.

Now, I still hope to get more comments on what to keep in mind when choosing the hosting.

Find another local startup and share the cost.

That's a crazy idea when you can same performance from a VPS with no capital costs and cheaper hosting AND better reliability. Read my findings here: http://www.productcriticblog.com/2007/02/startup-lessons-from-productcritic-save.html

I disagree with your findings. Sure it's cheap, but hosting companies tend to oversell this virtual boxes to people and performance is not the same, especially when it comes to disk I/O (any kind of I/O) and handling sudden CPU usage spikes.

$1,200-$1,600 for a server is not expensive. If you are trying to start up a company and you're an engineer yourself, that money is what? Your half week salary? Or we're talking about running things from a dorm room here?

You make very good point about reliability though.

Anyone know anything about the forthcoming Amazon EC2 public beta? Coming anytime soon? Private beta testers are happy enough? Seem worth pursuing?

I signed up to get a second beta account, but have heard nothing other than "We'll let you know."