In my experience, sampling developers with whom I speak on a regular basis (and myself), private repos on GitHub are very popular. This is especially the case for web developers, as open sourcing web apps is less common. It's nice to have all of my open source stuff in the same place as my closed source stuff, such that I (and anyone I deem worthy) can interact with both in the same way.

For corporations (read: Process, more process, and some paperwork) that I had to work with this would not be possible. Deploying this strange new thing instead of clearcase/perforce/team services internally? Hard to sell maybe, but possible. Putting your source up somewhere else, out of control: No way.

Especially for verticals where the law heavily influences your ability to share just about any data (depending on country and laws this might include insurance companies, banks, energy provider, probably quite some more).

If self-hosted Gitorious allowed for private & public projects then I could let it face the internet and have the perfect solution. I've seen a few implementations of private projects with merge requests, but sadly the Gitorious team has largely ignored them.

I have to agree with you: Both on one server is not possible. The only way to make this work would be cumbersome:

Install a public and a private instance of gitorious. For private projects: Works just as before. For public projects: Push to somewhere and make the post-receive hook propagate the change to public/private.

Ugly? Hell, yes. It's nothing but a workaround.

On the other hand: You can mix GitHub and Gitorious just fine. Your client (if you use one, or the git cli) doesn't care about the hosts, so having http://myPrivateGitorious repositories next to http://github.com repositories would work fine and you gain the best of both worlds. It's the same system. You can easily push/pull/merge from one to the other, it's not like the decision to use one or the other has to be an XOR.