Lots of M&A in hosting - even in back-up. Rackspace IPO'ed in 2Q08 and released its earnings. The street doesn't understand Rackspace or the hosting space. They just like the cash flow.
"Revenues were $131M, up over 9% from $120M in Q1. Annualized, that is a 53% growth rate, inline with their 57% growth over Q2 2007." [telecomramblings]
In other hosting news, it seems that hosting is looking to the Channel (indirect agents also known as referral agents and telecom agents and VARs). From Phone+: "Atlanta-based provider, NationalNet, which offers fully managed and dedicated Web-based hosting solutions and services, has launched an extensive channel partner program for partners throughout the country."
I'm not saying you have to issue an IPO or go nation-wide with an agent program, but it is good to see what is going on and take the best pieces for your own business.