Ask HN: why don't larger cloud hosts use container virtualization?

I've used container-based virtualization for Linux (OpenVZ / Parallels Virtuozzo) before and it's rather amazing performance-wise. Performance is bare metal, and the densities that can be achieved are staggering and easily destroy any density achievable with paravirtualization. In addition, OpenVZ/Parallels supports container migration and it works flawlessly in my experience. (When I say destroy I mean destroy. I have seen thousands of containers on a single node that would support a few dozen KVMs.) The only downside I can see is the lack of custom kernel capability, but that only affects a tiny percentage of applications. (None in many configurations.) I'm curious as to why Amazon, Linode, Rackspace, etc. do not offer container-based virtualization. Is there some Big Reason?