Earlier quoted context omitted.
But I think examples like Sparrow (Mail app) represent the idea that if you make it obvious that it's worth paying for, people will do it. Maybe if they had a freemium system. It starts off free but if you want no ads and more features you pay $X/month. A user could lobby friends to make the jump to the paid version.
You just described LJ's model. It didn't work well (outside of Russia).
It could simply be, that it was too early for LiveJournal? Back then – admittedly, now in many ways – the idea of a social network was new. It's value had yet to be proven at that time. However, with almost 1 Billion people on Facebook the value of such a network has been proven.
However, while I say 'I want to pay for Facebook' I'm really saying I want to pay for a service that allows me to keep in touch with my friends and nothing else. Not a service that allows me to keep in touch with my friends while also selling my data, and the problems that go with that.
I wrote a very short thought on this idea: