I disagree wholeheartedly. Your operational philosophy complements your SLA goals, it doesn't force them.

I can't figure out how your comment that "understanding mistakes will happen" is compatible with 99.999% uptime.

I'm of the opinion that 99.999% for an individual instance isn't particularly achievable in a commodity hosting environment. That kind of uptime doesn't leave much room for the mistakes that you and I both anticipate.

I do think that 99.999% is doable for a properly distributed whole-system across multiple geographically-dispersed datacenters.

I think Joyent has gone wrong in promoting individual instance reliability.

Always ask how numbers like that are computed.

They're not. That's a statement of what customers have enjoyed up until now. The actual SLA simply states what refund you get for each hour of downtime.