Yes, there is a monthly fee, and rightfully so. You aren't paying to play the game, you are paying to help maintain the server. The servers that MMO companies supply are beyond expensive, and require an income to support.
On another note, it's difficult to read through all the negativity some of the members here have over TOR. I suppose that creates quite the split between KotOR gamers. Those who aren't interested seem to have very strong opinions about it, while those interested are ready to trample baby bunnies over to get their hands on a copy.
I for one, am more than interested. I love role playing, I love MMO's, I love Star Wars, and I love KotOR. Playing an MMO based on KotOR is a no brainer.