I'll try and explain it a little more clearly:

You are offered free space & bandwidth to upload a film in either 640 x 480 or 320 x 240 resolution.

Then, you pick a price to sell the film for. Each time someone downloads the film, you recieve 50%. For example: if your film is selling for $4 you would recieve $2. The other $2 goes to the cost of .... space & bandwidth.

It's a way for filmmakers to generate some extra revenue from the online fans who don't want to wait for a DVD in the mail OR, for fans who just won't spend that much money on an SOV horror video.

If a few hundered people are downloading your film per week, it would likely generate more money than your DVD sales have in the last year.

Anyways, at no point does the site claim to be offering this space & bandwidth for nothing in return. It simply offers free space/bandwidth, for filmmakers who are interested in uploading and selling their videos easily, without finding their own hosting service.

Cheers!