I'd agree with you on the point the site is trying to make, but what I find interesting is the rationalization for this behaviour.

The meat of the article, IMO, is this paragraph: "This system breaks down, however, when products stop costing anything to produce. The cost of provisioning service to a single user of a site is effectively zero, close enough that it can seem worthwhile to give it away in order to expand your userbase. Unfortunately, in doing so, you lose the revenue stream which has supported businesses since the dawn of commerce."

This is really obvious advice, but people need to hear it. There are loads of developers working on the next great social consumer facing product that will revolutionize the way people interact yada yada yada - the only downside being that they have no idea how they will monetize.