While I do agree that most people pay for AV cause they don't know better. But as a computer tech I have to say the vast majority of PCs I fix with virus or spyware problems have a free AV on them. The fact is a program such as NOD32 or Kasperky are better at detecting and stoping virus then the free AV collection and have a lower inpact on the system performance. If your experienced enough to find the free AVs and make a choice to use them you likely don't need an AV in the first place. NOD32 and Kasperky and even the new Norton AV 2009 (not the 360) do offer better protection for the "click here to see the Olsen twins naked crowd" then the free AVs.
They just don't know any better.
Some people can't even read.
ignorant people.
Not knowing .
Security suites provide a lot more features than just anti-virus software, such as firewalls, anti-spam, etc... Certainly you can get those features using separate programs for each, but many people prefer an all-in-one solution. Manufacturers of paid security suites also generally provide support, which you won't have with a free product. Paid products are also licensed for use in a business environment, whereas the free programs are generally home use only.
It is simply they do not know what a freeware program can offer people.