A few months back I decided to put a 24/7 script on a Rackspace Cloud instance, instead of the more obvious Amazon EC2 choice. The reason at the time was my needs were low CPU but relatively high bandwidth and diskspace usage and it worked out cheaper.
Now I've had a few invoices in I am relieved to say there was no catch. My past three invoices have been $11.99, $11.99 and $12.20 (USD). This is for a minimal CPU spec (256MB, 1.6% of a quad core CPU, 10GB disk), 1.1 to 1.3 GB/month of outgoing bandwidth each month (there is no charge for incoming bandwidth), and cloud storage rising from 4 to 8GB. 90% of the monthly cost is for the machine, and the cloud storage has risen from $0.63 to $1.15. The bandwidth is not costing much at all.
In contrast on Amazon EC2, the micro instance would cost $15.65 (including $1 for 10GB of EBS storage), while a small instance would cost $62.25/month, of which $0.03 is the bandwidth usage. (The first year of that micro instance would be free if you are a new customer, but I am not.)
So, at the CPU bottom-end, Rackspace is winning on cost. The other feature of Rackspace Cloud that I love is there is an automatic daily backup of the full disk image, and that backup is stored in the cloud storage. (Storing that backup is basically all my $1/month cloud storage costs.)
What do I not like? I keep using up my 10GB disk space. But there seems no way to move to 20GB without doubling the CPU spec and doubling the monthly cost; with Amazon micro I'd just increase the EBS storage space. With an Amazon small instance I'd get 160GB and would not care.
What do I not like about Rackspace and Amazon? It is that you just get a basic linux distro. You have to spend time installing, configuring and maintaining. And the configuration is not trivial; I've kept a log of all I've had to do, and it includes things like moving ssh off of port 22, setting up an iptables firewall, installing a mail server (not a POP server, just enough so I can *send* email alerts), and writing my own low-diskspace email alert script. The latter was done just the other day after my application broke, yet again, because the machine had run out of disk space.
P.S. As I want 24/7, and have not mentioned the need to scale, what about cheaper shared hosting? Well, I couldn't find a VPS, that gives me root access and no restrictions, for under $10/month. It seems Rackspace is winning that fight too?
(2012-08-15 UPDATE: Rackspace are stopping their minimal server config: no more 256MB option in their "nextgen" V2 API. Also scheduled
images are not available in the V2 API (yet). In other words the two things I pointed out that were good, in the above article, are going! I guess the Rackspace marketing department will have to work out a positive spin on "cutting out our competitive advantage so we look just like the competition now" ;-)