I got to talk to Mikael and Niklas Hed, cousins and chief officers at Rovio Mobile (the company behind Angry Birds), last week at E3 about their game and its success so far. They told me that the game has had four million downloads to date across, both, its paid and lite versions, and they said that they'll keep updating it "as long as the underlying market keeps growing." I asked them why they have chosen this model of just supporting the game with free updates, and they pointed to Valve's Team Fortress 2 as an example; they're updating the game just because they're "focused on bringing great value" to their customers.
Future updates to the game will include new birds to play around with and a little bit of multiplayer functionality, which is coming in a "huge update" very soon. I also asked about the iPad version (which has gotten some bad reviews, since it's basically the same as the iPhone version), and they said that it was just a matter of resources, but they did want to update that version of the app in the future.