Not 10$ but 10euro, hosted in Netherlands. (aff link) http://www.xeneurope.co.uk/clients/aff.php?aff=026

Me too.. I'd be happy with 128 mb at my current level of use. But I suspect they might lose money at that price point.

unless their costs are radically different from mine, (and if anything, their automation is better, so their costs should be lower) the small instances are quite profitable.

(None of this takes into account semiyearly/yearly pricing discounts.)

The difference is that they sell their boxes with prices proportional to memory so that doubling resources costs double (25.6MB RAM per dollar), whereas at prgmr, you charge a flat $4-per-guest fee and then charge linearly for space on top of that (64 MB per dollar).

Bonus fact: If you both were to offer a 173 MB size, the costs would be almost the same (~$6.70/mo).

It's funny, because my choice of pricing with my current support costs, and the fact that nearly all my advertising is fixed-cost 'brand building' vs. per-customer cost referrals or click ads, actually makes the smaller domains /much/ more profitable than the larger domains, which yes, probably means I've mispriced something. But the smaller domains do have a much larger 'margin for error' - if I sell a block of them to spammers, or to people expecting a full-time sysadmin, they can get expensive fast.