Yes, A small business can use the free version of Google Apps up to 10 users. When they get bigger, they need to start paying. There is no rule or agreement I can produce that says otherwise. If someone tells you one exists, ask to see it. I have some companies still using the free version with up to 30 accounts -they signed up back when the cap was 50. Google serves up ads on the right side of your mail and other services to pay for your free account.
There are more administrative options for security and control in the paid version. Some of them are: substantial email storage, email security tools, inbox deligation. Your consultant can lay out the full list of paid features for you.
Get a good understanding of what you need for your business. If you rely on a paid feature, then you will need the paid version. At under $5 per user per month, it's worth it.
Are small businesses allowed to use the standard Google Apps service (10 users)?
