I also don't really see the problem. Very few will use excessive storage, which is the insight those free services with sizable storage is based on, like Flickr

I also don't really see the problem. Very few will use excessive storage, which is the insight those free services with sizable storage is based on, like Flickr with 1 TB free which is essentially "unlimited" when it comes to photo storage. Key is to restrict it to a certain use scenario / file format, which will make it even harder to abuse.