People raid for several reasons in no particular order:

1) Loot
2) To progress -- This can mean Finish LFR, Finish the raid on normal, finish the end boss on heroic. Progression is different for everyone whom currently raids and is mostly self-defined but it is a goal for many.
3) The experience/cut-scenes/the RP/seeing the content / killing the last -big-bad
4) To have fun, with their guild, friends, or their own personal enjoyment

Of these things -- 2 things are likely to keep a player returning to content more than a few play throughs.

1) Loot is one of the few things which will bring a player back week after week.
2) Progression -- killing 1 new boss this week you didn't kill last week. If you're not in a guild which has interest in hardmodes, or in a guild which can plow through normals at a relatively fast pace this can take you anywhere from 1 week to 8, to 12.. it really varies, but can have a short shelf life.

The experience and "fun" tend to be lessened upon repeated play-throughs -- getting stalled too long on either loot, or progression.

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Now Blizzard is not a B2P game (Buy 2 Play) where it's content seldom if ever gets renewed. Neither is it a free to play game (in the traditional sense, as many would argue free to level 20 barely scratches the surface). It is a month-to-month game. It stands to reason, that they make money as a company when their subscribers play ever single month.

Now LFR isn't like a traditional raid in that progression in LFR is a non-issue. With few exceptions just about every group that goes in there, will down every boss if not on the first try than on the second. It's something you knock out in a weekend, or an hour or two. It will get you the experience of the cut-scenes if that's all you're really after if that's the only experience you were looking for and it's even something you -could- do with friends from other realms. But -- and here's the sticking point for me -- these things don't seem to have the repeated play value that traditional raids offer.

The one and only reason why I think people continue to do LFR past the first few times is Gear. You're primarily raiding with strangers -- most of which are rude jerks -- whom if they speak at all -- tend to not be very nice or interesting. {Typical LFD/LFR chatter}.

LFR from my eyes then was always about the loot, since they have made progression a non issue making loot the reason people continue to run it. Since they created loot to a) open raiding up to more people and b) give some people an end-game which before really had none, or if not none than very few options. Then I really don't see why you are looking for "ulterior motives" for blizzard to keep people on the hamster wheel.

Shocking, news at a 11 -- a gaming company which earns it's money monthly, wants to keep people playing monthly ...

I dunno, just my two cents really.

I don't personally enjoy LFR. I don't find it challenging. I find the people I deal with - jerks -- and the pace of it unnecessarily fast. The only reason I go into LFR is to give myself a better chance at my 4pc to better assist my main raid group -- to kill time when bored -- or to try out a spec I am maybe not as great at, in a slightly less threatening environment.

It doesn't have a lot of repeated replay value for me. But then again, I don't think that it is suppose to for me. I think since I raid with my guild in normal and heroic versions of the fight .. running LFR every single week should lose it's appeal after a time to avoid burn out.

I think that if they use Loot as an incentive to keep people coming back I think it prolongs the shelf life of those whom don't raid in normal or HM guilds. It allows the content to stay fresher for them, longer -- while still giving them access to players who otherwise wouldn't run the content any more. (This is why Heroics started dropping badge gear in the first place .. to ease transitions into traditional raids and to get raiders to stop, stop running heroics. If you keep raiders running heroics -- you make getting groups for new level 80's or in our case 85's easier, and help boost maybe under-geared or newer players through a place like LFR until they can compete).