Similarly to other replies (but my own opinion): it's not a huge source of revenue today, on a single customer basis, compared to our biggest customers, sure. But our goal is to provide potential customers that can't justify larger scale, 3-nodes databases, something they can build on and grow on our platform.
We would never want to pull the rug on paying customers: we want to enable them :-) sure it's not a huge part of our revenue, but that's not the goal. We just want to provide a great product, in a way that's affordable to everyone.
You of course don't have to take my word, but I think it makes business sense to do this and not pull the rug.
Compare to a free tier where you bleed money in the hopes that customers will end up paying you. Hope isn't a good business strategy right? :-)
In what way? Companies drop/move on from small customers all the time as positions and analysis changes. $5 a month might make sense now, but with thin profits, a lower than predicted "upgrade rate" and maybe a higher than anticipated support cost etc and this becomes a less profitable option without price increases, which loses customers causing more increases because of none scalable costs etc.
Throw in a change of leadership or business focus and it's an easy short term boost to drop the many smaller customers and focus on the big fish who make the real money.
It's a common pattern, echoed over many industries, and while you might not see it being likely here right now, if the concept literally doesn't make sense to you, you need to look up some basic business ideas because it's a pretty valid concern.
It's easier to pull the rug out from under a group of customers who earn you 5% of your revenue than it is to do the same thing to a group of customers who make you 25% of your revenue.
This small $5 plan is obviously not going to make Planetscale very much revenue.
You were buying flow for your sales funnel with a free plan now you want to attract users with a low tier plan. Your reputation was hurt with the first rug pull so why be surprised that users expect another rug pull from you in the future?
If a free plan attracts users that can be upsold is that free plan not profitable _vs_ paying for advertising?
If such upselling is done via rug pull tactics it damages your reputation vs never having a free plan in the first place.
If a new bank offered you free or discounted banking would you move over your accounts and payments and credit cards? What if that bank has a reputation for upselling via rug pulling?
For users the cost of switching can mean that services that are free or cheap are not worth it if they are expecting a rug pull.