freetail:

I disagree with this (I think the marketplace has already spoken: people hate microbilling, defined as a few cents or less), but the analysis here is worth reading: Sample: “But here’s one thing freemium fans can’t deny: in their model, a tiny minority of paid users subsidizes the service for everybody. It is this simple fact that makes the freemium model self-defeating, because, for the numbers to work, the price of the paid service must be set artificially high.”