Free services have to be only good enough to entice you to need/want the service. And they have to suck enough so using the free service is poor enough that people end up paying. It's a delicate balance.

 

I'm not sure this is entirely truth, I mean, there is another possibility for this services to offer a good free service without punishing the customer: advertisements. That's the way megaupload functioned, the earned money with publicity offering a huge download speed to their clients - and they made A LOT OF MONEY.

By the way, the publicity in katfile.com in the free service is like killing flies, it's everywhere. Don't get me wrong, I've got nothing against katfile and I guess other companies will do the same, I'm just saying that offering a bad service if you have the option of doing better MAY BE (I don't know for sure) is not the best way to manage this business.

Best