Consider doing the math on how many paid users need to exist to subsidize each free user. Suppose each free user uses, say, 20% of their space and does every single available promotion, yielding 20GB of space. This means each free user uses 4GB (a huge overestimate, I suspect.) This means that given S3 storage rates (and if Dropbox doesn't have better than the public rates, they're doing it wrong), each free user costs Dropbox $0.22 per month. Let's say that each paid user uses half their space, and that all the users are only using the 100GB plans. Then paid users cost them $2.75 per month. This also assumes that absolutely no data is deduped.

Now, let's assume that Dropbox pockets a quarter of the money to pay salary, other business overhead, and so on. This means that Dropbox needs a conversion rate of about 4% to be profitable. Sounds completely reasonable and sustainable to me, especially given how generous my storage numbers are.