why would people use your software or service

Once a week i meet up with a start up that tells me his idea in great enthusiasm, and as all ways i am asking a simple question "why would people use it?" and the worst answer i can get is: "because it's free"
Please remember one major rule: if users want willing to pay 1$ for your service so they will not use it even for free.
Think about your self do you use any thing that you are using it just because it's free?
Another problem that keeps coming back in start up is "we got a good idea lets expand it to a bad one"
If you have a good idea stick with it. don't expand it and start a competition with other bigger companies... it will not work...

Navot