I was joking with Rundle last week about what would happen if all the designers and developers in the Network got together for a weekend and copied the 37signals suite of products and then we just released everything for free. All of their products are simple and I'm sure most developers who have used them are thinking to themselves that they could do something just as simple in a short amount of time. If you want to do a hosted model you could still sell advertising and run things for free or you could simply just do it cheaper than 37signals and add your own features.