I'll try to explain it, this is coming from me (one who uses hotfile)
Hotfile why uploaders use it. Simply because it offers better rewards. Many uploaders using rapidshare and megaupload used it because they offered rewards;
Former Rapidshare: 10 000 pts = premium account, at times 2 000 pts = premium however these points are worthless now, and that rapidshare now offers a whole new set of point system.
Megaupload: offers the 10 000pts = premium, and you get 9 000 pts for buying one month so you really only need 1 000pts to redeem a second free month! But they don't offer cash payouts unless you have points in the 100 000. Which is possible, but often many of the downloads don't add towards your point system.
As for hotfile, it currently adds each download no matter the size into a point category. So uploaders who use hotfile have an incentive to upload and distribute. Rather than just store crap. Plus payout is at $15 through paypal. It's premium offers the same as megaupload, and more than rapidshare who currently now is renovating for the worst.
The only thing i would have to say for hotfile is i wish they had their own upload manager. I mean megaupload has one, although it's a crappy one in that in often has errors. etc..