I'm not arguing that they are obligated to provide free services. What they did was suddenly pull the plug on a free, public service for one specific user, which just happens to be a competitor. Also, this was without any announcement and clearly intent on interrupting the service for mostly unrelated third parties (namely WPEngines customers), just to hurt WPEngine.
As to them being hostile to negotiation, we don't know what happened behind close doors. But from the facts that were publicly presented, Matt wanted an amount of money, has (so far) not presented any reasonable legal basis for it and has overall been pretty emotional, so I do believe WPEngine when they claim that the demand was unreasonable and in bad faith on his side.
If this would have been a calm announcement that WP will cede any free hosting services to for-profit WordPress resellers, with a reasonable timeline for migration, he would have my full support. Maybe I could even get behind singling out WPEngine, if the case was solid. But the way this happens, Matt just looks like the bad guy.
> If I build my business on scraping X.com and then X bans my IPs, that's on me. They don't have to provide me free internet access to their content, that's a privilege.
But someone allows free passage on a toll bridge for everyone and suddenly decides to just deny your transport business specifically and publicly insult you, it looks a bit different. Especially if the owner of the bridge just happens to run a competitor for your business, things do look a bit fishy. I mean, fair enough, but this move was clearly intended for maximum damage and someone doing that does not at all look like the reasonable party, sorry.