I think the lack of knowledge about hosting has created this boom of new hosts. Managing hosts is not something you can read through a manual overnight; you need to know what you're doing, have certain skillsets, eg. with the technical side of things, and be able to spend more than you gain in the first year.
Don't expect to make a profit in the first year, or even 2. I think many are under the assumption that people will buy their low cost hosting, and be with them forever, paying them monthly without bother.
You need to have money to start a host, not $10, you need at least $750 for the first year to spend, and even then, that may not be enough. Think of buying several dedicated servers, advertising, a good billing system (WHMCS), a good user panel (cPanel) and 24/7 technical support.
I'd expect most of the new hosts will oversell or go bust before the end of February. This almost happened when I was with Web Hosting Fox, but we managed to survive that and they are now 18 or so months old (2009). It shows that new hosts can survive, but at least WHF, had a decent supply of money, good technicians and decent marketing.