The insight is, offering something for free isn't worth it. And why? Because free users cost more money than paying users when considering the headaches and work they cause.
Well, of course free users cost more money than paying users: they aren't paying! The question is: how many conversions of free to paid users did he get? Because it may still be better to have a business with lots of annoying free users than with no users at all.
Well, of course free users cost more money than paying users: they aren't paying!
You're twisting his words. While it's obvious that free users will inherently incur a net cost, it's not obvious that the actual per-user cost of a free user is higher than that of a paying user. The latter is still a very interesting observation.
