I like VPS's, and the low cost involved. Has any provider thought about giving an account on two machines, with three IP's. One for each machine, and one floating IP. Using something like keepalived to take control of the virtual IP. And maybe a private connection between the machines with no bandwidth costs. Or maybe load balancing as well as IP take over could be a more efficient use of the resources.
Of course the provider is still one huge point of failure, but for some projects I would prefer to have two machines to add that bit of extra redundancy.
It may could double what a single VPS would, and maybe a little more, it still offers a great service and should be profitable for the provider.
The first reason I started using VPS systems was for a geo dns project. I had a VPS on four continents, serving the IP of the local server based on country IP's.
DNS isn't what I want here. Say I had four different VPS systems in four data centres on four continents, I still want a pretty stable master. So i'll still handle failover in software, I know that one site should be pretty stable, assuming it's not knocked off. And I don't have to trust one VPS master machine.
The point of this is using tools like keepalived to have one floating IP highly available.