I would be surprised if apple eats the cost of a service that does not benefit most everybody. Apple doesn’t need good PR in spite of anything that is posted to the contrary here in MR.We don't really know the cost. Your $99 may be wildly inflated. I'm in the camp of just making it an included service and make for some good PR.
Other than the 5 gig of iCloud, which comes included as part of the price of the iPhone, I can’t think of anything else. But maybe you are right, raise the cost of the iPhone by $50 (or some increment), include the service, get great PR, make billions, and get bashed on MR. It’s a win-win-lose.
I say go for it.