Why take time to read the Terms of Service?
As most services that we subscribe for, hosting services come with a contract. To sign-up for the service, you have to agree to the terms of that contract and sign electronically. An electronic signature is something as simple as pushing an "I agree" button and it's just as legally bounding as if you'd put your signature on paper (although the hosting company could have a few problems in proving that it really was you pushing that button).
However, I don't think anyone really wants to go that far as having to actually prove anything in court. It's a lot safer to do everything in your power to avoid any legal issues.
One of the things I should point out is the fact that many (if not most) web hosting companies have both a Terms of Service (TOS) agreement and an Acceptable Usage Policy (AUP) agreement and you agree to both when you sign-up for their services.
In those agreements, although most of them might sound like mumbo-jumbo legal stuff, there are things to look out for. Well, maybe not necessarily "look out", but you have to make sure that you agree (or that you can live) with them.
As I was telling you in the "unlimited bandwidth" article, you can find that unlimited can be actually limited in multiple ways. If you can agree to that thing, then agree to it. It's your choice.
Another thing to note is that most web hosting companies reserve the right to modify the terms as they please, sometimes stating that they can do that without sending you a notice. That's not fair in my opinion. At least they could say they will do their best to notify you. If not, it's just like if you were playing a game and one of the players had the power to change the rules. The simple fact that he's changing them can be seen as a tough challenge, but if he doesn't tell you: Hey! I changed the rules!, you're playing the wrong game there...
I wouldn't blame the web hosting companies though. Most of the times the terms are in strict accordance with the terms of the contracts they sign with their own service providers (connectivity, servers, etc.). It seems right for them not to promise you things that they're not promised in the first place. That doesn't make it right though and it is again just something we have to live with.
Another thing that you should know, especially if you're signing-up for a "shared or "virtual" hosting account, is that you are sharing the resources with the other hundreds of websites placed on the same server as your website. To protect themselves from "usage abuse", most hosts clearly state that they reserve the right to temporarily suspend or even terminate accounts using too many resources.
So, if you have a website that for one reason or another could have usage spikes, it's a thing that you have to take seriously into consideration. Such usage spikes can be caused by a high number of visitors over a short period of time or a script that uses a lot of CPU, memory etc. The alternatives? A VPS, a semidedicated hosting account, or a dedicated server, neither of which are cheap solutions.
Many web hosts do not accept anything sexual in nature on their servers. Often this is not clearly stated in any other place except the Terms of Service (TOS) agreement and/or Acceptable Usage Policy (AUP). So you have to carefully read the Terms of Service to know this.
Another largely unclear part is the spam issue. Although it's already clear that spam is a bad thing and most web hosting companies terminate accounts sending spam, there's no unique definition of SPAM. Every host can and uses its own definition, which, more often than not, is not clearly explained anywhere on their website, not even in the Terms of Service (TOS) agreement or the Acceptable Usage Policy (AUP).
Generally, if the email is 1. not sent to multiple recipients, 2. they're not strangers or 3. you don't advertise any services and/or products in the email, you can consider yourself safe. There are however lots of gray areas. What if you're sending an email to a company proposing a business deal. Is that spam? It's up to the hosting company to decide. And it's hard for them to stand by you and support you in such a situation, because the person complaining could go to one of the host's providers and tell the whole story.
If that provider sees your email as spam, the web hosting company has a lot to lose, and so on with the providers of the provider. This is why hosts tend to suspend or terminate accounts accused of spamming (even in the gray areas). Why should they risk everything for a single client?
It's really an unpleasant situation for everyone involved in it. Unfortunately, you have little chances of winning. The first time you might get away with a fine or a temporary deactivation of the site (so that you'll learn better), but the second is usually final and you'll have to look for another host.
Many web hosting companies guarantee a certain uptime (usually 99.9% or more). That might seem OK first, but when you read the Terms of Service, the things can change quite significantly. You can find out that the time when they make upgrades (hardware or software) or anything like that "to assure the best possible service" , does not constitute downtime. Or you might find out that you'll simply not be billed for the time when the server was down. So if you pay $30 per month for hosting, and your website was down for 10 days, you'll only pay $20. That sure sounds like a joke to me, but it isn't!
Another thing that I've seen is a "strange" definition of downtime: downtime shall constitute any period of time longer than X minutes (usually more than 5 minutes). So, if your website is down 4 minutes, then it works for 1 minute and so on, you don't experience downtime. Funny, really funny!
A nice example that made history, are the Terms of Service of web hosting companies offering free hosting. The Terms of Service stated that everything that the user uploaded on their servers became their property (they claimed the copyright). Although I never heard of a web hosting company actually enforcing this term, it sure shows what can be found in the Terms of Service of serious (in this case meaning big) companies. In the given example, the public was outraged and the Terms of Service were silently changed, removing the contentious parts.
I gave you these examples to show you why it's a very good thing to actually read the Terms of Service (TOS) agreement and the Acceptable Usage Policy (AUP) when signing-up for a web hosting service. I will not tell you in this article how a certain term should sound like. Just make sure it's something you agree with. Oh, and read the TOS and AUP before you sign-up, NOT after.