Finding the right place to host your content is important. Thankfully their are several excellent providers. For virtual private servers (one server shared with multiple virtual servers) Linode and DigitalOcean. And there are lots of good choices but those two are widely appreciated for excellent service at a good price.
AWS ec2 (the Amazon elastic cloud) is not great for minimal hosting in my opinion – it adds extra complexity and is likely more expensive. But it is a great solution when you have the resources to manage it and you have significantly variable demand. Because of the ability to add capacity on the fly as you need it you can maintain a low baseline and add capacity only as needed and drop that extra capacity as soon as it isn’t needed.
Rackspace is another good option for hosting. Rackspace and AWS are often used for very large applications and sites but Linode and Digital Ocean also can serve those needs and provide similar options to add capacity on the fly.
All of these options require you to manage your server (which may well be a virtual server – that is just a portion of a actual physical server that you control).
Rackspace also offers co-location where your physical server is put in their network operation center with electricity; cooling; network and internet connections; and physical security managed by them and the server managed by you.
As colocation has evolved what is included and to what level things like physical security and redundancy are dealt with have evolved. It has become quite complex to understand all the options for those organizations that need more than a simple virtual private server. As often happens when their is a business need, people offer solutions. And there are companies that specialize in helping you find the best colocation options for your needs.
Today the cloud options have led many organizations to eliminate (or greatly reduce) there own network operations centers and colocation needs. But cloud options are not always the right choice. And for some needs cloud options are not appropriate yet (mainly due to security or legal issues steaming from security concerns).
Managing your own servers with a colocation arrangement can be significantly cheaper than cloud hosting options (especially if you don’t need to massively increase capacity to deal with short term bursts of demand). Of course, technology continues to change so quickly it is hard to predict what the future will bring.
Service quality is absolutely critical for colocation. While saving money is important, the reason colocation was selected (over virtual private servers or the cloud) is normally how critical the function was. Using experts to help sort through the options and assure the quality of service of provides is wise.