Ref: http://code.mixpanel.com/amazon-vs-rackspace/

Thoughts?

I haven't used Rackspace Cloud services, but we were a Rackspace customer and currently use EC2, S3 and CloudFront.

While I didn't make the original decision to go with S3 or CloudFront, the company was hosted with Rackspace at the time and decided to use Amazon instead because of a consistently bad experience with Rackspace. Since then we've moved more stuff to Amazon and another company and stopped using Rackspace (and saved a few thousand dollars in the process).