[nandan]

You are right that this article talks of a "wider applicability" of the business model where services are cross-subsidized by advertising.

But, there's more:

The article emphasizes that the "costs" for an Internet Service, which hitherto have been cross-subsidized by advertising are, for all practical purposes, not relevant any more. It is true that this article talks only of the bandwidth, storage and computation costs and excludes the cost of labor. But much has been said before about the costs of labor decreasing via improved frameworks and tools.

The question then becomes, "What does it mean now, that the costs to be cross-subsidized are so low?" This goes back to what PG, Marc Andreessen and others have been claiming all along: we are going to see more startups, a LOT more startups. Also, according to Chris Anderson's Long Tail, LOTS of startups in niche domains. Startups operating in niches, might not make a whole lot of money through advertising. But, this is precisely the point of the article, given the cross-subsidization needs being so low, some startups would be happy making a couple of thousand or tens of thousands a month (instead of millions).