Google has always charged for storage in Google Photos - it's part of your "Google Drive" storage quota. They do give you 10GB free though, which can be substantial for a lot of folks.
Although low resolution image uploads doesn't seem very useful for most people. The point of cloud storage is peace of mind to keep your data safe... and to me that implies the original photos not reduced resolution photos.
They are still very high resolution. They're just not the original 50 MB file. It worked perfectly well for the overwhelming majority of people.
Pixel offered unlimited storage even for uncompressed photos, but that option was also discontinued a few years ago.