As Killer Instinct is a free to play game, there are certain elements that are "locked down" for every user until they splash out on cash. One of the biggest things that is limited for the basic player is the available character roster. In fact, only one character is available for play at one time, and the others must be purchased permanently before they can be played.
Before you shout about how money-grabbing this screwy tactic is looking to be, one thing that makes it more reasonable is that the character that is available for free changes regularly, thanks to the rotation system that works similarly to the weekly system found in League of Legends.
This means that players will always have a chance to try each and every character, but they'll have to put in money to purchase a character that they enjoyed playing with.
Right now, Jago has been replaced with Sabrewulf. On top of this, some character balancing has been put into place, and some bug fixes and menu changes have been added with the latest patch.
The store has been fine tuned to make browsing through it more easy on the eye, and the annoying bug that forced players to put their controller in USB slot 1 has also been resolved.
If you're still not happy with the whole "one character at a time" thing, there are packages that give players access to all eight characters, and it costs roughly the same price as a full retail game.