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Hi, some hosting companies that come to my mind are webair.com, mojohost.com, leaseweb.com, isprime.com, choopa.com and nationalnet.com. Not all of them offer VPS packages, you should check. But I'm sure you can find some entry level VPS with enough bandwidth for a reasonable price.
One cost effective solution to get you started, is to get a VPS setup with nginx using the http mp4 module, or lighttpd with the codeshop h264 module (license required for commercial use). Those webservers are lightweight and allow for a simple pseudo-streaming setup.
To feed your webservers with video, you will need to prepare the video specially for the purposes. The correct conversion settings and specially the bitrate and keyframe interval will affect how your video is played and the ability to seek the video by your visitors. Our video transcoding application, Tremendum Transcoder, is very easy to use, has a set of default profiles which are suitable for this purpose, and also includes HTML5 video profiles.
A correctly setup web server will also allow range-request, so the visitors playing back using html5 capable browsers instead of flash player will also be able to skip to parts of the video without needing to buffer the whole file. That's important to save on your bandwidth bill ;-)
Once you got your media ready, you will need a good video player. Two good choices are FlowPlayer (flowplayer.org) and JWplayer (longtailvideo.com). These players in their latest versions support html5 and flash playback integrated seamlessly, and make it easy to deliver video to a broader audience.
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