I have been using the rackforce.com $59/month Windows 2003 VPS and very happy with it. System is very responsive (they are using Microsoft Virtual Server as the platform, which means you get a true virtual server, with fully dedicated RAM). I am migrating to a dedicated server at ThePlanet this summer for other reasons, but I would highly recommend rackforce.com for a VPS. Prior to that I had godaddy VPS for a little while. Customer support was great, but the server was unpredictable in its responsiveness. My logs showed occasional 3-4 second lags from the time I place an order to the time it was sent (the machine must have been trashing like hell). I suggest you stay away from any hosting packages that use the Virtuozzo platform - it helps reduce the cost, and works OK for web hosting, but the occasional slow downs might hurt your ATS.
Just to update everyone, I tried several VPS options and none were trustworthy enough. They would randomly reboot during the day. Not a good thing for a trading bot host. I ended up going with a dedicated server from Sago Networks. I got a dual core with 2 GB of RAM for $109 a month. Since last November when I got the server I've had two incidents. One was a shutdown when the power spiked, the other was a network issue. The first was November, the second was December. Since then no real problems (there have been 5-6 network issues of less than 2 minutes but I'm not sure if they were at my end or IB's end). Unless you can find a really good VPS host (please post if you do!) I recommend getting a dedicated server.
I have been running simulated trading on Amazon EC2 since late April. They charge $0.125 per hour for Windows platform plus fees for storage and bandwidth. I keep the server on for about 10 hours * 5 days per week. My bill was $36 for May. As its a pay as you go model, one can also use it for occasional test trading on a separate hosted machine. There are no fixed fees (other than a few cents for storing your machine image and data). I use their "Small Instance" (1.7 GB of memory, 1 EC2 Compute Unit == 1.0-1.2 GHz 2007 Opteron or 2007 Xeon processor). I have not encountered any performance or continuity problems. The cool thing is if I want more CPU, I can boot into a much larger machine within minutes. Bandwidth is terrific and consistent. Average ping time to gw1.ibllc.com: 23 ms, 14 hops Some caveats: its C & D drives are ephemeral, when you turn off the machine they disappear. So, you need to do two things: 1) setup the machine the way you want it and capture a machine image, and boot from that image afterwards; 2) create a persistent drive (called EBS) where you store your persistent data (ie drive E).
I've been playing around with EC2 using a Windows Machine this morning & made a bit of progress. Its much further along than when I last looked at EC2. I'm pretty impressed thus far. Here is a quick start guide to get people going if thats the route they want to take. If nothing else, you can set up an instance and compare & contrast it to your current provider for practically no money. http://ec2-downloads.s3.amazonaws.com/elasticfox-owners-manual.pdf If I can find some time I'll create a public instance that people can use as a base image and modify as needed. Eric