For most people it'd probably make much more sense to find a provider

that

offers some form of SMTP relay service. It'd probably be cheaper/month, and they wouldn't have the trouble and expense of providing/maintaining a colo server.

Yep, if you aren't technically inclined that is better.

What if the cost were only $10/month and they didn't have to maintain anything other than a set of usernames/passwds (SMTP Auth) or perhaps a list of their own IPs (relaying based on IP)?

It's starting to sound like a nice little business for a college senior to set up using one of the colo providers from Paul's list. It would be a lot more palatable for large providers to crack down on unauthenticated SMTP if there were such alternatives available. Then instead of cracking down on users they would be supporting new small businesses. I imagine there are a lot of people doing this already but we just don't see it because they don't have a catchy name for themselves like "ISP". --Michael Dillon