Is free sustainable??

After the speculations about Youtube endangering Netflix, I ought to think about "Is free sustainable"? Netflix is just a small example when we think about MSOffice getting phased out by Google docs, the most expected Google Chrome OS, Google wave that could potentially replace Webex and Skype.Is Google trying to kill the licensing business once for all? Here Google seems to set a trend for most of the business models through each and every application they innovate. Google does this because 97% of its revenue is from the online advertising, and it doesn't need money from the licensing business. But is it fair enough that it puts an end to all other players in the licensing market? Imagine the situation when Google is no more the portal where the advertisers go to post their advertisements. What would happen to Google and the others like Microsoft,Apple and other players like Netflix, Webex(Cisco)?? Is free sustainable?