It’s called unbundling and almost all airlines are doing it, to a greater or lesser extent. Or you could call it flying a la carte, the airline provides you with a basic service at a basic price and you choose the add-ons.
Clearly, the ability to reserve a seat has a certain value for you (or you wouldn’t be bitching about it). It costs the airline *something* to supply this service. Should the passenger who couldn’t care less where he sits be expected to cross-subsidise the one who does care?
The trick is choosing which products to unbundled, and what to charge for them. While not advocating the Ryanair approach, there’s nothing intrinsically wrong about charging to go to the loo. It costs the airline money to install toilets, both actually and in terms of foregone revenue; some passengers use them for free while others don’t but still pay a share of the cost of providing them.