If you are releasing free software then it doesn't matter since your not offering support any way, so it's not bad.
Closed source development does not scale - it is limited to the available work hours and imagination of the owners.
I had a lot of fun doing support & sales work with clients as sales engineer for an open source software company. Access to free software is, obviously, great for me as a user.
On the other hand, it seems harder for very small companies to make a living on support (the kind you can really charge for, SLAs with big corps etc) than to sell an iPhone app, for example.
Also, if you're making your money on support, there's a possibility you might be less motivated to make your product very easy to use (not that paid software is always great in that respect, of course).