speaking as someone who's only income is selling VPSs, if your application works under shared hosting, and you can find competent shared hosting providers for a reasonable cost, you are probably better off with shared hosting.
Now, personally, I consider hiroku and google app engine to be shared hosting. very expensive, high end shared hosting. (in fact, carefully consider the expense... if you have low revenue per compute cycle, or if you plan on scaling up your usage before scaling up your revenue, they may not be suitable just on cost.)
Now, the advantage to shared hosting is that it actually has all the upsides the cloud promises. You actually eliminate your SysAdmin. VPS hosts (or "cloud" hosts that just give you an *NIX box) only eliminate the need for a hardware guy, which is the cheapest sysadmin role you can have.
Also, there are some performance and reliability advantages to having one large box dedicated to, say, running php, etc... vs setting your tiny private stack up on some 256MiB box. It's extremely difficult and expensive to give you a live 'hot failover' VPS without your help. It's pretty simple to have hot failover with a shared hosting setup, hot failover that the customer need not notice.
Now, the downside of shared hosting is control. While /in theory/ shared hosting should kick the shit out of a vps for anything shared hosting can do, here in reality, that's not always or even usually how it works. when you outsource your sysadmin duties, you are dependent on the people you are outsourcing to being both competent /and/ caring about your problem.
The thing of it is, if your provider doesn't care about you, then you are /much/ better off with a xen vps. with a xen vps, the other hosts on the box aren't going to mess you up nearly as much as on an OpenVZ or a shared hosting system.
This is why I sell Xen VPSs rather than OpenVZ, FreeBSD jails, or shared hosting. Yes, running a xen host takes more hardware, but it takes a lot less sysadmin time from your provider.
The only real solid "do this no matter what" advice I can give you is to have off site backups, and practice bringing your system up on a new provider every now and then. All providers, shared and vps, make mistakes. Sometimes those mistakes wipe out both live data and backups- see the hypervm disaster.
Always be ready to switch providers, and you will always be with a provider you are satisfied with.
I agree with most of what you said, except for the Google App Engine part. The App Engine free quotas are great (Python support and free quotas are basically the main reasons why I chose App Engine).
The App Engine free quotas allow you to operate at zero cost while still getting (on an app that accesses the datastore a couple times every page) about 1-2 million pageviews a month (not as much as the 5 million Google advertises, but it's still pretty darn good).
Now I don't know how long the free quotas will last, but with the amount of traffic that support, revenue isn't an issue when starting out.
eh, I know at least one small, revenue free startup that is in to app engine for a grand a month hosting fees. (If you own your own equipment, a grand a month supports maybe 100Mbps and around 10 sockets. 20 if you find someone who doesn't rip you on the bandwidth, but that's hard.)
/if/ you could buy app engine compatible service from more than one company, it would be great; it's just that googles current model with app engine /can/ result in some rather high costs (either re-writing your code to run off of google, or paying through the nose) once you reach a certain threshold.
Now, for some things, that's fine. It would be perfectly acceptable for my business model, for instance, for me to do the signup page and account management stuff on app engine. everyone who sees that stuff is paying me. but there are many business models for which it's current price structure is not very good, namely if you plan on being both big and free, it is not suitable.
the real problem, I think, is how difficult it is to move off app engine. If you are doing something in your own VPS, it's fairly trivial to move to another provider, or to your own hardware if you need to scale and save some money. this, I'm given to understand, is /much harder/ if you built for the app engine platform.
Now, personally, I consider hiroku and google app engine to be shared hosting. very expensive, high end shared hosting. (in fact, carefully consider the expense... if you have low revenue per compute cycle, or if you plan on scaling up your usage before scaling up your revenue, they may not be suitable just on cost.)
Now, the advantage to shared hosting is that it actually has all the upsides the cloud promises. You actually eliminate your SysAdmin. VPS hosts (or "cloud" hosts that just give you an *NIX box) only eliminate the need for a hardware guy, which is the cheapest sysadmin role you can have.
Also, there are some performance and reliability advantages to having one large box dedicated to, say, running php, etc... vs setting your tiny private stack up on some 256MiB box. It's extremely difficult and expensive to give you a live 'hot failover' VPS without your help. It's pretty simple to have hot failover with a shared hosting setup, hot failover that the customer need not notice.
Now, the downside of shared hosting is control. While /in theory/ shared hosting should kick the shit out of a vps for anything shared hosting can do, here in reality, that's not always or even usually how it works. when you outsource your sysadmin duties, you are dependent on the people you are outsourcing to being both competent /and/ caring about your problem.
The thing of it is, if your provider doesn't care about you, then you are /much/ better off with a xen vps. with a xen vps, the other hosts on the box aren't going to mess you up nearly as much as on an OpenVZ or a shared hosting system.
This is why I sell Xen VPSs rather than OpenVZ, FreeBSD jails, or shared hosting. Yes, running a xen host takes more hardware, but it takes a lot less sysadmin time from your provider.
The only real solid "do this no matter what" advice I can give you is to have off site backups, and practice bringing your system up on a new provider every now and then. All providers, shared and vps, make mistakes. Sometimes those mistakes wipe out both live data and backups- see the hypervm disaster.
Always be ready to switch providers, and you will always be with a provider you are satisfied with.