Security. Since bloggers from Blogspot are hosted by their own server, risks are taken into consideration. Users of WordPress on the other hand should check their own blogs and you should take control of your own site.
"Paypal!??!" I hear some of you murmuring. Yes. It has it's critics and I'm one of them but until I hit the jackpot (or get a full time job) it remains one of my only options.
HostGator will set everything up for you in thirty minutes or less. If you're concerned about the cost, don't be. A domain name costs roughly $10 a year, and your hosting service is approximately $5 a year. That's it. I would however recommend that you upgrade to a private registration for a small additional fee. And that's it.
When I purchased a web hosting service, I also got one domain for free to register. I registered my domain and I wanted to install WordPress blog on it. DH provides one click installation of many open source softwares like WordPress, Gallery, ZenCart, PhpGedView, OpenX, phpbb, joomla, MediaWiki and many more. So I just logged in to the panel, select WordPress, insert the mysql database, user and password information and clicked on Install. Within just 3 minutes, I got mail from DreamHost saying that WordPress blog is installed on my domain. That was the easiest WordPress installation I have done ever.
Many small business and personal sites are not going to get a lot of traffic. For such sites, it does not make any sense to spend hundreds of dollars on a dedicated web host like Rackspace or Media Temple. That would just be wasteful, as it isn't necessary.
These networks can also help in finding relevant blogs or web-sites to get links from. Some search engines see links coming from relevant web-sites or blogs as a huge boost to the blogs authority stature. Another good point is you have total control who does and does not more info link to you.