Yeah that’s right. Really, the difference is between free software and free services.

Software can be free and open source and that can be a viable model, even a preferable model. Services can not be free without some party being exploited. In the best of cases this means services are provided by volunteers (and they are being exploited), but more commonly in business, it’s the users who are being exploited.

But as a rule, you should be suspicious of free services.