In these days of Web 2.0 services that rely on quick customer adoption, the strategy has become so common that VCs have coined a term for it: freemium.
Nothing new here; “give away” the handle to sell the razor blades, etc. Despite the time-tested nature of the strategy, I have no doubt we'll hear how this “freemium” talk signals the peak of a bubble.
One wrinkle I'd like to add. The strategy of having a free, and useful, version complemented by for-pay upsells is far more effective, in my opinion, than offering users time-limited access to the full thing. At the very least, it keeps lightweight, non-paying users around until such time as they need the advanced features of the for-pay versions of the product.
It seems to be working for companies like 37signals.