Nothing new, its been going on for years. It is called overselling. It is based on the premise that a client will never actually use the resources allotted to them and if they do they pull up an obscure terms of service paragraph that allows them to either a) throttle the sites bandwidth or b) discontinue hosting the client.
When you see a host offering 200gb of disk space and 2000gb of bandwidth for $5 a month then that should raise a red flag.
The best advice I can give anyone is to check out the prices of dedicated servers at the likes of theplanet.com layeredtech.com as these are the budget server providers. If a webhost offers you same resources as a dedicated server that costs $99/month for $5/month its not a great deal
webhostingtalk.com is a good forum for doing research on a host.