I would like to note that this was the very model that EA was talking about last year, I believe. Thinking about how some other prices for DLC characters have been handled. I am willing to bet that the minimum for these characters would be $5 possibly $10. If it's the latter the consumers on this game are getting boned hardcore. A fighting games fun is derived form local/online multiplayer and a diverse roster.
The counter argument here is you don't necessarily have to buy the characters. Severely restricting yourself by what want to spend is a move motivated entirely on greed. Microsoft doesn't have a chance with this business model. Not at this time.
I think it all depends on the pricing for how I personally feel about it. In all honesty, I can see a little bit of good in this. This will sound stupid, but honestly, it makes sense. I miss pack in games. I miss demo discs. The pack-in ended with the PSOne, sadly. The demo disc followed shortly after. One of the best times I remember in my gaming history is playing the generator demo disc that came with my dreamcast on 9/9/99. One of the few benefits of the XBox One is that I can just buy the system ($100 more though, ouch!) and take it home and download Killer Instinct and play it. I assume other games will be there with the KI model. If you like it you can puchase the game. It brings back the demo disc pack in after what... a f&#*ing decade. Here is a good podcast reminiscing about nothing but that first demo disc...
http://segaaddictskidstable.podbean.com/2012/12/21/dreampodcast-episode-1/Now, the price matters. If it does follow the understandable hyperbole of most commenters, then each character will cost $5, let's say 14 characters... holy crap that's a lot of money. Of course, that's bad. But if the have a complete pack for a standard game price. Who cares? The argument that I mainly see in this case is really getting to the point of there is not a physical release. This confusion of the two terms seems to border a definist fallacy. The thing is the pay for character model could be good or bad at this point. If I was an XBoxOne owner and got the free to play Jago, then an option to buy all the rest of the characters for the full game for only $5. I would jump for joy. But of course that isn't likely. Likewise, I would be really upset if it is $10 for each character. I don't find that likely either. It is likely to fall in between.
At this point in my collecting, I honestly don't care to have physical discs. I don't think they should go away. Other people like them. But I don't see myself or want to collect for modern systems. With modern games, I want to experience them for a few hours and nevr touch them again. In this way, the free to play model works for me. It works really well. But I'm unusual in the gamer world in that I think everything after the dreamcast is crap anyway (except Forza).
For an alternate view (although I agree with the first half. Although I think he gets confused on being angry with the XBox versus the game in the second half. I mean do we know anything about pricing yet? I just see a lot of people falling for the fallacy of argument from silence). Anyways, here it is (AS ALWAYS NSFW):