More than likely you can start out with shared hosting and work your way up. We have many, many clients currently using our service for their video site, using scripts such as phpmotion and clip-share which tend to be the most common.
Bandwidth and disk space usage is very small for most video sharing sites created from individuals or small businesses.
So my recommendation to you, start small and work your way up as there is no way your going to be using large amounts of disk space or bandwidth within your first 1-2 months.
Well there if there is a bandwidth price reduction I am sure ur hoster will also reduce his pricing or maybe give you a hardware upgrade. So dont worry about that. The market is very compatative now so you will get a good deal now and also later on as time goes by.
One last question: has bandwidth become less expensive since 2006 and if so, is this a trend you expect to continue?
Bandwidth prices, at least on the low-cost end, have stabilized a bit now. You may see them come down slightly over the near term but I wouldn't base your operating cost projections on it. Nobody can really say what things will look like, say, 5 years from now.
With video serving, disk transactions are the key. You won't need it just starting out, but eventually you'll want some type of RAID storage. If you start on shared or VPS you will eventually want to move to dedicated if the site grows. If you decide to start on dedicated then consider asking the hosting provider to make sure the server is easily upgradeable to RAID.
What I have done is made it so I can use "inexpensive" servers with 100mbs unmetered connection whereever I can find them. I stick flash media server on it and using some webservices im able to intergrate it with our main website and keep it all tied in.
Generally on a Core2Duo, 2GB Ram job with Flash Media Server running you cant really get over 20Mbs without FMS giving up the ghost and restarting
So maybe cheaper machines on 10mbs unmetered might be the way to go.
What I also find is the CPU usage isnt very high but FMS still dies every so often and automatically restarts