For fun, I'll jump on this dogpile......
You are correct, it's not free. It costs the ISP in terms of space, power, cooling, ports and, to a small degree, hands-on labor by ISP personnel.
On the other hand, streams are going to cross the last mile no matter how they're sourced. But if you can keep thousands of streams OFF your transit interconnects through on-net caching, that savings can be measured in real dollars.
It's similar to the way Akamai works, and if I'm not mistaken, BHN has on-net Akamai mirrors.
Perhaps Open Connect is too new and the technology used by Netflix is unproven. I can appreciate that viewpoint. Once the product is mature and their particular flavor of mirroring passes the trial by fire, I'd be surprised if BHN didn't join in the fun eventually.