Back when we were running a busy hosting business, we got a lot of stuff from the local crowd. Not sure how much you want to be involved locally, but we got TONS of clients just by joining the Chamber of Commerce and going to their little social gatherings. Same goes for web design for that matter. A lot of people don't realize how crappy their current hosting is (i.e. no email addresses @ their domain, 50mb disk space, nonsense like that), until you let them know. The local gatherings were a great place for that, since everybody seems to always want to discuss their web-based options for their business. It's the big thing these days (still), and most small to medium-sized businesses, at least where I'm from, have no clue what they're doing in regards to Internet marketing.
Believe it or not, there are also many web designers who don't wish to deal with the hassle of web hosting. We ended up setting up some local guys with reseller accounts at discounted rates (since they would be bringing us a bunch of business), or would give them kickbacks (basically like an affiliate program) on every account they sent us. That worked out very well too. We ended up getting exclusive rights to these guys, so almost every single web design client they got would mean a hosting client for us. Not bad since somebody else is doing the advertising for you, and the only thing you pay for that advertising is a small one-time fee on a per-client basis...and of course a bottle of wine and a card around the holidays.
IMO, hosting on a world-wide level is pretty well tapped. If you don't have something different or innovative, or offer really competitive rates, there are plenty of big companies out there who will do the job better and cheaper than you ever could. It's very difficult to compete.
However, on a local basis, a lot of companies (especially those that are not Internet savvy) are looking for a local company/local support for their Internet needs. If you can offer them what they're looking for, you're golden.
