I'm proposing in a view of a potential customer. If you see the pricing of a competitor, like framey.com, they make it easier for you to choose your estimated price range.
It is just a more marketing standing point. What is better, 4gbs of music or 1000 songs?
I totally understand what you're saying, but I still disagree, at least for a service where you can upload arbitrary video. Framey is a bit different, because you can reasonably assume an upper limit to the amount of time a user will record themselves on a webcam in a browser (or restrict them to a max # of minutes).
I know you were just using it as an example, but music just isn't a good comparison for this conversation. Video is simply much more expensive than audio in just about every way, from storage to encoding.
Songs are comparable in duration (and file size), videos are not. With UGC, video file size can easily vary by the factor of 1,000. So the infrastructure required to transcode, store, and deliver a 5GB file would cost much more, compared to a 5MB file. It's difficult to come up with "simple" pricing that would fit all.
It is just a more marketing standing point. What is better, 4gbs of music or 1000 songs?