I prefer the monthly fee model. Free to play games often end up being pay to win or pay to win faster.
It doesn't have to be that way... An MMO can be the ULTIMATE DLC delivery mechanim.
Start with a core storyline and then release new chapters on a monthly basis. If each chapter contains the same degree of content as Knights of the Nine did for Oblivion, and Dawnguard looks like it is going to have for Skyrim, then you have epic, forward-going content for PvE players that does not force them into the Raid or Die mentality, while leaving the typical MMO endgame elements such a dailies, raids, and PvP intact.
If I were Bethesda Game Studios when I moved on to developing the next full game, I'd farm out development of continuing chapters of the Skyrim saga, with a stipulation that all ideas have to have BGS approval. A joint sales agreement with the third party would allow them and BGS to make money...
But Zenimax Online Studios will be in a position to produce a long-running, forward-going story series set in a familiar, yet ever-expanding world. They can sell the core game in stores, release a new mini-expansion every month, unlockable via microtransaction running something like $15.00 each. They can sell cards in stores. similar to a pre-paid phone card that is useless unless purchased and activated at the register. These cards, when the activation code is entered would grant "Drakes" (a recognized Elder Scrolls currency) that can serve as purchase points for microtransactions. Each card would grant 1500 drakes. And each mini-expansion would cost 1500 drakes. Drakes could also be purchased online via credit card or paypal.
The monetization goal should be at least what a normal MMO with a subscription charges per month, but rather than just paying for access to the game (which if you read the terms of an MMO, you discover that access is all the developers are obligated to provide and all that you are entitled to), which allows a developer to be lazy and just rake in the money from subscriptions, this approach would be conjoined with a development process that would ensure that there is always a new chapter of playable content every month. Nobody would have to pay a dime to PLAY the game. But just like many of us purchased Tribunal, Bloodmoon, Shivering Isles, Knights of the Nine and soon will likely buy Dawnguard, to enhance and expand our single-player experience, a monthly purchase of additional chapters to enhance and expand our MMO experience.
Every MMO has a live content development team. All this would do is ensure that they earn their pay and thus earn our gaming dollars.
The core game plus whatever expansions one has purchased would always be available to that account. So it would not be a per-character thing. So unless you create a second account.
Another good MT-purchased product could be an offer to purchase data discs containing the installation data of all the content released post-launch. Whenever enough of it to fill an entire CD, DVD or Blu-ray Disc is accumulated, the offer to purchase it would be made available. This data would be freely downloadable, but in the event that one's computer crashes, or any other reason that requires a full reinstallation, an MMO's patch history over the course of months and years has a LOT of data. And it can take HOURS to download and patch, depending on how fast one's broadband connection is. Having data discs would shave a massive amount of time off the process, letting one get back in the game quickly. CD would cost 500 Drakes. DVD would cost 1000 Drakes. a BluRay would cost 1500 Drakes. The data would be freely downloadable through patching. By purchasing a data disc, you are paying for the convenience of not having to endure extensive download times.
Drakes could also be used to transfer characters to other servers, purchase additional character slots, or obtain special collection items both in-game and out. Things like shirts, hats, coffee mugs... all the things that usually tend to show up.
They can do so much with this model.
Smaller and larget denomination "Drake" cards could be available:
100D - $1.00 - Online Only
400D - $4.00 - Online Only
1500D - $15.00 - In Stores and Online
4500D - $45.00 - In Stores and Online
9000D - $90.00 - In Stores and Online
18000D - $180.00 Online Only
36000D - $360.00 Online Only
Double Points Forever - $361.00 - Online Only.