If you're a kid, you probably have more time than money. That's the force behind MP3 file trading, which is kind of a hassle but is free (albeit illegal!). As Steve Jobs famously pointed out, if you download music from peer-to-peer services, you're likely to deal with problematic file formats, missing album information, and the chance that it's the wrong song or a poor quality version. The time it takes to avoid paying means "you're working for under minimum wage," he noted. Nevertheless, if you're time-rich and money-poor, that makes sense. Free is the right price for you.
But as you get older, the equation reverses and $0.99 here and there no longer seems as big a deal. You migrate into a paying customer, the premium user in the freemium equation.
This has certainly proven true in my life. I've ditched the Napsters and BitTorrents of my teenage years. Now, my fiancee and I love to sort through our Netflix queue together, and we actually get kind of excited waiting a few days for the next movie to arrive. (Though, unfortunately for me, she's having the new Twilight movie sent to us for Monday. Bleh!) We also don't mind paying the bill, as it's only a few dollars a month.
Similarly, now paying 99 cents to have a song downloaded instantly to my iPhone wherever I am is nothing compared to the pain that I would have to endure to get the same song illegally.