"I've never understood why jails didn't take off. I guess maybe since linux took off and the bsds didn't, but they're just nice and elegant."

The very first VPS[1] provider, JohnCompanies, was built entirely on jail (and FreeBSD 4.x).

At the peak we had over a thousand FreeBSD jails running for customers all over the world.

In the end, fancy provisioning and fine-grained resource tuning (with products like Virtuozzo) won out. Although JC is still operating and still provides jail-based VPS.

The offsite backup infrastructure that was built for JC customers became a standalone company in 2006 and was named "rsync.net".

[1] The term "VPS" had not been coined in mid-2001 so I made up the term "server instance" which didn't stick.