I have mixed feelings about paper towels laid out like this.  They don’t suffer from the over packed dispenser problem.  Nor do they require special equipment for restocking (e.g. specially rolled paper, prepackaged packs of paper towels).  On the other hand, they do tend to get messed up rather easily, and water can get on multiple paper towels, making more of a mess.
But, on the whole, they’re less of a headache for the customer, which is a good thing.