I wrote an article, here:

http://www.dedasys.com/articles/webhosting_market_lemons.html

about why I think the market for web hosting is a “market for lemons” – the fact that you can’t really tell ahead of time what the quality of service will be like causes it to be a problematic market in some ways, both for service providers and consumers.

It’s a work in progress, so ideas, comments and suggestions are welcome!