Our project does all its hosting on a vps cloud, and we spend more than the amount stated. Yeah having local hosting at a competitive price to Amazon, RackSpace etc. would be great in my opinion. Currently local hosting is not only unreliable (in terms of weak SLAs, unclear redundancy structures in data centers ...  ) but also expensive. The other problem with Amazon (which favors local hosting in Kenya)  is the license agreement (this is also the case with Google ... ) which gives the US government significant power to restrict (or stop ) services running on their hosting (based on the foreign assets control sanction list ) -- European providers dont have such restrictions. This is particularly important given the political situation ...and also the political situation of neighbouring countries - for instance if you want to host services accessed from Sudan or Somalia (Sudan falls under the sanction list ... )  ...

Ashok