I suspect that has a lot to do with billing monthly for an annual plan. That leaves people deciding whether to continue paying for a service that they are not

I suspect that has a lot to do with billing monthly for an annual plan. That leaves people deciding whether to continue paying for a service that they are not using or paying out a penalty in excess of the monthly rate to terminate the service. Both options leave the impression that the company is trying to punish the customer. Contrast that to paying for a year upfront, where the customer is more likely feel foolish for paying for something they did not need.