I think this is the crucial thing. If you offer a service with what you might call a "livable" or "comfortable" free tier, it will end up used as heavily as you allow by people who will cost you resources indefinitely, but who are far more likely to switch to another free service than to ever pay you a cent. For instance, as terrible as this blogger claims to have found Feedly, he used it for nearly a decade!

Skip the temptation to try to eke out a little money from the free tier (because you probably won't) and think of it strictly as a trial option. Either give a time-limited free trial of the service or a heavily-limited version of the service that shows how it works, but that absolutely nobody would want to use at that level forever.

(And in that latter case, then you'll still find one or two users who are willing to subsist on your free tier, whether that's a 3-feed RSS reader or whatever. Shrug and reflect that those weirdos aren't costing you much.)

The people you want to advertise to are not necessarily people who have money. It’s people who will buy your product. That’s the supposed value of online advertising: better targeting. There is still plenty of money to be made outside of the most affluent segments.

> My guess is that a person who subscribes to the entry level of a product is more likely to be upsold to something else than a free user is going to even think about paying.

That’s true. But you still need a way to onboard people on the first paying tier at some point.

> try watching TV during the daytime and it is depressing to see ads for prescription drugs and Medicare scams and personal injury lawyers

That’s because of the demographic who watch TV during daytime: mostly retired people or unemployed people amongst which disabilities must be above average. Forty years ago you will have bombarded with ads for soap.