First off, here's the relevant link:
Next, here's what I posted in comment to someone about them - I think it's worth thinking about.
It's not "about money". It's about "providing a reasonable service without a lot of money". The problem is free users cost money. Since the site has no advertising, that means the only source of revenue they have is from paid users.
a.) Paid users are supporting free users with their subscriptions.
b.) LJ doesn't have a lot of money.
Putting limits keeps people from abusing the site. The exact numbers are still being determined, but having limits is not only reasonable but it's only sensible. My only surprise is how long it took to put them in.
How many free things do you know that give away unlimited amounts? Even things like soup kitchens only give away one meal per person, because if they gave any more per person they'd run out and everyone would suffer. Same deal here. Paid users get more because, well, they're paying for it. Free users are still getting something for nothing, which is a pretty damn good deal by my estimation. No?
To put it another way: let's say there was a community theater that let people see indie movies, plays, musicals, whatever, the kind of stuff that never gets shown in mainstream places. They let anyone come and see them for free, too, so everyone can benefit. Someone's got to pay for that, right? So if they sold "premium" tickets to the front few rows, would that be bad? If it were the difference between closing the theater for lack of money, or keeping it open so everyone can benefit but letting the people who are keeping it alive get more benefits, which is better? People who donate money to museums get first access to new exhibits. Should they stop doing that and just close down the museums altogether?
It's something to think about, anyways. I'm not attacking you, just trying to present the other side of things. LJ's a great service, and one that's been given away for free to anyone who wants it, and is still being given away for free. The thing is, it can't survive without money - money to pay for hardware, for bandwidth, for electricity, for hosting, for people to help Brad run it - and that money's got to come from somewhere. They might get a little just by asking for donations, but not nearly enough to keep the site alive. So yeah, they're limiting free users and giving paid users more benefits, but it's the choice between that and nothing at all - and I can't imagine all that many people would really think it'd be better to just shut the site down.
Update: Ironically, I was trying to edit this and add more to the end but it failed to update and lost my edits, thanks to the servers being so damned loaded. So, there you go.
In the end, the problem is that LJ is over-taxed, and it can't keep up. So the choice is either to let service continue to get worse until no one uses it, or to do something to limit people. There's only so much cake to go around; everyone gets a piece, but only if people don't take more than their fair share. The limits aren't there to punish people, but to make sure everyone gets a piece of that cake. If paid users get a slightly bigger piece of cake, well... they paid for it.