The top hosts differentiate themselves quite well:
top end server hardware (fast cpu, fast disks, etc)
great support (quick replys and standing behind their product)
great uptime
See FAST CPU and disk are really more beneficial for the hosting company than end user.
You can't mass sell slow.
Even lowend companies realize this simple fact on the hardware side. Their sites reflect this with wild claims about RAID-10, SSD, gobs of RAM, premium networks, etc. Even if they are mostly full of marketing crap.
great support (quick replys and standing behind their product)
I love good support. It's truly rare to find. Too many folks use young, foreign and useless to staff the helpdesks. This applies to all companies in all segments. There are not enough good support companies.
Yet, every company seems to claim fast and effective support and record setting ticket response times.
great uptime
This is a pre-requisite to being alive in a service business. I see 99.99% uptime all over the place. In reality, lots of folks can't hit much above 99.6% in a month. Too many issues with multi-user environments, too many attacks, too few eyes on the resources (who just ran out of disk recently on multiple nodes?).
All these are baseline requirements today in offering services and few can really live up to them.
Other differentiators would include... Customer community (Linode), filtering (BuyVM), multiple location migration (Amazon), bundled freebies (Rage4)..... and how about a big dose of real humans and not just for marketing creation day, but someone who manages the community, helps the community, creates content for the community--- a community manager.... Yeah that's different..