Paying yearly requires a lot of thought - careful weighting of the risk/potential benefit ratio. As a potential customer there's only so much you can find out about a host to establish trustworthiness. Even if trustworthiness is not an issue, a lot of things can happen in a year, including bankruptcy, sale of the company etc.

Preferably one should go monthly at least for a few months to test drive the services, but then again, some hosts make this highly unfeasible from a financial point of view (high setup fees for non-yearly payment).

So, generally, from a customer's point of view, yearly payment is not as "fine" as a monthly payment. It really means a higher risk.