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That's where I found the cheap (5gbp per month from NECS) VPS I run my docker instances on. Maybe it is atypical.

It'll certainly work with a cheap Xen or KVM instance but those are usually more expensive.

Digitalocean has a standard docker+ubuntu setup you can fire up for about that price. However, I haven't had much luck with its stability and switched back to running on bare ubuntu. Docker kept bringing the system down even when I wasnt running any containers!

Long-term I expect cheap VPSes to be built on Docker itself because it's more upstream than OpenVZ.