I think the reason they can offer it so cheap is a combination of scale, cheap electricity, and tax breaks. iWeb is also in Quebec, so I figured there must be some tax break. Lo and behold there is one heck of a tax break:

http://www.investquebec.com/quebec/en/financial-products/smb...

Basically the Quebec government pays 24% of your company's wages, up to $83,333 per employee!