The Unix security model is designed for mutli-user hosts. Shared hosting works very well under Unix, iff the admins know what they are doing. Why do you think that before virtualization got popular people were using shell accounts, chroots and BSD Jails for their webhosting/IRC/... needs? Why do you think we have CGI, SuExec, ...?
I won't deny that VPS are great, but a properly set up shell server will allow you to do many of the same things a VPS can do.
> The Unix security model is designed for mutli-user hosts.
Reminds me of the story of RMS complaing about evil admins that were restricting root level access. The views on computer users and security were quite different in the early days of UNIX.
RMS' views might have been different. In a little thing we call actual reality the sysadmin is an employee hired by the same people who bought the system (no small investment in those days) to maintain it, and I don't think any reasonable person has ever denied that.
I won't deny that VPS are great, but a properly set up shell server will allow you to do many of the same things a VPS can do.