The $199 package is one-time fee, you can obtain the license for a life time then, and get 6 months of free tech support and upgrading service.
Then,
http://www.123flashchat.com/faq.html#c5
When certain free update and support period exceeds,
customers need to pay 20% of the license fee (1 year) if they still want the updates and email support.That means, $39.8/yr for 50 user license.
If you can host the chat by yourself, you don't have to pay the hosting fee.
Please make sure you've got power to run java application on your server end, cause only ftp account is not enough to install 123flashchat to your server,
the bottom line is you gotta have telnet or ssh authority to install it.
http://www.123flashchat.com/faq.html#d3