The web site must be located on a server computer connected to the World Wide Web 24/7. Most internet service providers (ISP’s) include enough ‘free’ space for a small web site in their contract. They usually state that this is for private use. A commercial hosting service for a normal small web site can be obtained for $5 per month but you generally get what you pay for & it's better to budget for $15 to $20.
Hosting can take place anywhere with plenty of cheap overseas deals available. Some Hosting contracts require a setup fee, typically $30 to $60. They sweeten the deal with various offers such as ‘money back if you are not happy after the first month’ etc. Carefully check out the overall cost and the benefits supplied.

The quality of service varies. The hosting companies talk a lot about 99.99% on-line reliability & backup services but little about the   important download speed for people accessing your site.
I feel it's hard to be 100% sure the services provided by reasonably priced hosting services will not deteriorate over a period of time. As business increases & there is more load on the equipment, service may slow down. This is not good for your prospective customers so hopefully the hosting company will be making enough income to afford to constantly update their facilities (& not take it all as profit). For this reason its important to monitor the download speed of your site & be prepared to change to another hosting service if required.
The technical side of hosting is quite complicated with many variables. It depends on many factors: what quality phone lines do they pay for? How close are they to a main trunk cable?

Some hosting services reserve the full space their customers pay for & their servers work efficiently because most users don’t use all this allocate space. Others work on the law of averages and while they supply the space you need up to what you pay for, they keep their servers crammed full, resulting in slow peak time service.
They are not like a local business you can keep tabs on, for example, you're most likely to find out too late if their supervision goes to pot & they close down through poor management.
This is not a problem as long as you keep on top of the situation &, of course, keep a backup copy of your web site.

We use a Melbourne based web hosting company who supply straight forward services at a competitive price and we constantly monitor their performance. A "belt & braces" disaster recovery system is in place whereby all web sites we handle are mirrored on our computer and each week backed up to a set of DVDs so multiple copies are available. These copies are stored at a separate location.