The web hosting companies sell their services by insinuating that the SEO process starts long before a site goes live. And I’d say that’s true if all you think about is how to optimize for the search engines. There are some things you should avoid when it comes to hosting and SEO, like getting too many links from multiple domains hosted on the same server. Also, if your site is hosted by a web hosting company that is blacklisted by the search engines, no matter how hard you try to optimize your site, you will never rank…
From an SEO perspective hosting is important as far as it provides the search engines with information about the location of your company. If you live in UK and you choose a host in Canada you will rank higher for certain keywords in the local search than in the web search. For example google.ca shows different results than google.com for “cheap web hosting.” That’s because google.ca tries to deliver the best results for its Canadian users.
If you have a business in UK and you want to sell your products in Canada, buy a .ca domain and host your site with a Canadian host. Ask the hosting company where are its servers located. Some companies are based in one country to have its servers in a different one.
Personally I think that the most reliable hosts are those with a very clear and transparent service policy and those that offer permanent customer support. The price is relevant as long as it offers value for what you pay.