It's no just "free users" that can suffer from this. A company I worked for has outsources some payments infrastructure to a third party. That third party had

It's no just "free users" that can suffer from this. A company I worked for has outsources some payments infrastructure to a third party. That third party had put in a very aggressive bid in order to win our business. We were to be their "big name customer" and they wanted to use that deal to gain credibility with other potential customers. It seemed like a rational business decision for them, and we took the deal. But, the fact is, that deal wasn't commercially sustainable, and we both suffered from it. They lost money on everything they did for us, and because they were losing money they tried to do everything as quickly and cheaply as they could, which inevitably meant badly. We were never happy with their offering. When the time came to renegotiate the deal, we went back out to market, and we invited them to participate in the tender process, but we were very clear - "This is the SLA we expect. These are the penalties we will apply if you miss the SLA. We intend to hold you to them. If you submit a bid, make sure it is commercially viable, and that you can afford to actually deliver on the SLA, or else you will end up losing a lot of money on this." I think we ended up sticking with them for a bit longer (due to politics and inertia) and then eventually ditched them a few years later.