Complex sentence: In a free business model, there are "n" number of services tiers--divided into a free tier and one or more paid tiers--where each subsequent tier offers increasing levels of quality and quantity of services to the customer.
Split into simpler sentences: In a free business model, there are a number of service tiers--namely, a free tier and one or more paid tiers. Each tier offers increasing levels of quality and quantity of services to the customer.