martinibuster - 4:44 am on Jan 15, 2013 (gmt 0)
Free in some kinds of products are considered a promotional activity. It helps with traffic, links, and ranking. It also promotes trust and familiarity with your product. Familiarity with a product is a powerful way to build loyalty. People stick with certain brands because they are used to how they work, the fit and finish, buttons and in the case of software, the workflow. Same with a template. The files are going to follow a certain pattern, etc.
So following the above model of FREE being the entry point for customers, the paid version must offer additional benefits or function. On pricing, it has been said that when consumers are faced with cheap, reasonable, and expensive price points, they happily choose the middle option. So you might want to consider creating an expensive option (with additional benefits), that will make the middle point look attractive.
As for the business templates, that might be the niche you may want to experiment with first, creating a limited function/option free version, a reasonably priced full version that has the full suite of functions and options, and an expensive deluxe version that has additional bells and whistles, perhaps with installation and modification services or something.