Unlimited repo's for teams of less than 5 compared to GitHubs pricing model for private repositories is a strong challenge.
Throw in that BitBucket is Atlassian backed and they can afford to subsidise BitBucket to sell their other tools (though I would observe that BitBucket does not do heavy sales tactics at all).
I actually prefer bitbucket to github day to day (I have about a dozen repo's with them) and they have excellent support for mercurial as well.
It's all speculations at that point but if the only reason to go to BitBucket is price then Atlassian is creating a community of poor/cheap people. The scenario for up-sell seems quite compromised in that regard.
Another thing is that if you're using open source products then they're likely on github. I agree that both platforms have a general feature parity but if you're going to interact with these projects often enough then it's better to stay on a single platform and avoid the context switch. Personally this only is already worth the $50-100 that our company is paying.
You can see that I am biased but something I would also like to point out: on more than one occasion github has prompted me to open-source things. When you reach your repo limit you're faced with a choice that you don't have with unlimited repos. There's a case where you don't want to think about it and just want to keep working as usual but for me space constraint is what keeps my home tidy.
I see your points but I'd note that "it's better to stay on a single platform" is actually perhaps not as good as it appears (all your eggs in one basket - for example when github went down the other weekend a lot of PHP developers where stuck without composer update for example).
The context switch is fairly minimal, underneath it is just git with a pretty web-ui.
The scenario for up-sell is absolutely fine, if you have less than 5 developers it's free, if you have more than that you start to pay based on number of developers, this is both more rational (you are paying for users not number/size of repo's) and easier to quantify.
In my opinion GitHub's cleverest move was making it free for open source repo's thereby building a good community of influential developers around their product from day one, this does give them a significant lead but it's not insurmountable (I'm old enough to remember when the first thing you did when you wanted the source code for an open project was head straight over to sourceforge) particularly as moving most (small) projects from github to bitbucket (or another competitor) is one git push.
The scenario for up-sell seems quite compromised in that regard.
Perhaps, but it's also likely that consumers are not Atlassian's primary target audience. They make most of their money selling JIRA, Confluence, Bamboo etc to companies and large enterprises.
Getting individual developer's hooked on free access to Bitbucket for personal projects is a great way to get those developers to agitate for using Bitbucket within their company.
If you have an active open source presence then you're already using github a lot of the time, personally I don't like switching tools a lot and I guess a lot of people feel similar. Personal preference aside.
If they'd offer a couple of private repos I'd jump over to GitHub in a heartbeat. I use BitBucket for private stuff, and then port over to GitHub when I want to make the code public.
At work we use BitBucket because of the unlimited private repos, and we've got a fairly good setup built on it. Every office I know either keeps their repo hosted, or uses BitBucket. I've only known one office that uses GitHub, and due to the nature of their work they keep their stuff public.
It's not even up for debate anywhere I work. BitBucket, or a private hosted repo is the only choice to make.
There are no incentives to switch open source projects to BitBucket, but there are incentives to switch to BitBucket small team/personal private projects.
Edit: Also open source projects will not start to pay github, but private projects might grow and will start paying for BitBucket
Since I'm talking about where I prefer to host my projects I think in this case it is about my personal preferences.
Obviously GitHub is the major git hosting solution for open source projects and yes I have a github account and yes I visit the site as much as I do bitbucket but mostly to pull repo's, check issues and read documentation.
When you're talking about private repos for commercial customers, paying is a feature, not a bug. A paid relationship is fundamentally different in that it creates obligations on both parties. When something is free, the person receiving the free service has few rights or remedies.
Unlimited repo's for teams of less than 5 compared to GitHubs pricing model for private repositories is a strong challenge.
Throw in that BitBucket is Atlassian backed and they can afford to subsidise BitBucket to sell their other tools (though I would observe that BitBucket does not do heavy sales tactics at all).
I actually prefer bitbucket to github day to day (I have about a dozen repo's with them) and they have excellent support for mercurial as well.