Why we haven't seen a web hosting company going out due to recession?

Bad economy has gulped all kinds of businesses - from banks to retail stores but web hosting businesses are rarely found complaining about loss of business - why is that so?

Web hosting companies are not like most other businesses that are limited in their scope by geographical boundaries. The opportunities in this industry are limitless and so are the ways of making things work while keeping up the flow of revenue and brand image.

When it comes to web hosting, it is easy to degrade quality without customers knowing it

In the web hosting industry, most customers pay for what they will never use i.e. huge amount of space, bandwidth and CPU that is promised to them but their websites don't take that much at all.
So they end up paying for company's profits.
So when a web host is faced with tough times, it is easy to fill the existing infrastructure with more and more customers. Most web hosting customers won't even notice that.

Outsourcing is the trick of the trade:

Most major web hosting companies outsource most of their operations to third world countries to reduce costs. It's not only the support that is outsourced, but many companies outsource sales, marketing and billing to other countries.
Some reputed companies have started hosting their servers as this makes their management cheap and brings great financial respite in a competitive market.

More people want to have a website of their own - grows customer base:

The trend of having a personal website with own hosting and domain is getting very popular these days. People see it as a way of earning extra income or for those who lose jobs, they see it as the only way to start up their own businesses.
Gone are the days when people were satisfied with free blogs offered by wordpress and Blogspot, now they don't mean anythign to serious bloggers and online entrepreneurs.
This leads to more demand for web hosting and domain registration services which gives a boost to the web hosting industry.