Why would anyone want to convert to the paid version if their use case is covered by the free version? Out of generosity?
In HPC, it is reasonably common for people to run RHEL on the scheduler, database and login nodes (totalling maybe a dozen servers) but then use CentOS (now Rocky) for the compute nodes, which might be hundreds of nodes. Those customers simply can't justify the cost of RHEL everywhere, even with more recent changes which make it cheaper than it has been historically in this use-case.
(but I'm a complete outsider, I just share my views and I do acknowledge I may be missing something, so feel free to elaborate further)
What you may not be aware of, or have forgotten, is the free versions provided by other companies that provide package compatibility and similar support (as in updates and security fixes) that CentOS did.
Oracle Linux, Alma Linux, Rocky Linux, and Amazon Linux. Quite possibly even more.
Red Hat will have a hard time undercutting them just by reducing their pricing, which is why they're using tactics like a free number of subscriptions/licenses for small organisations and developers and trying to cut off access to the source code.
For us, this means we stop doing business with RedHat.
If the free RHEL variants disappeared today I'd wager most of those companies would choose other distributions (Debian, Ubuntu, openSUSE, etc) or making the jump to containerisation or serverless before paying for RHEL. In the end less people would be using their kind of Enterprise Linux, which in turn will result in less conversion to the paid version of it.