That’s why we need regulation. Under these market conditions, Google’s business model does appear to be the best for them.
In the long run it's better for everybody. But it is true that "the long run" can be pretty long.
> Do you think Google has never considered that business model?
I think Google probably considered it early on but found it easier to go the way they actually went. But "easier" is not the same as "best in the long run".
> their current business model will let them extract the most money from their products
Google doesn't have products, they have services. And of course, since their services are free to users and users are now addicted to that, they can obviously extract more money with their current business model since they have made a concerted effort to make the "users as customers" business model impossible.
However, their current business model was being built during the same time period when "Don't be evil" was still the company's motto and still apparently taken seriously by company leaders. Which means those leaders were either very disingenuous or delusional. Because addicting people to a free service and then exploiting them and their personal data in order to make the money they can't make from the users directly, as customers, is evil. And trying to keep their current business model propped up in the face of users becoming increasingly aware of the ways in which they are being exploited, is only going to force Google to be more and more evil. Sooner or later, if it doesn't change, it will kill Google as a company.
> That’s why we need regulation.
Regulation won't fix this problem. Corporations can always either buy their way around regulations (oh, another million dollar fine because we broke regulation XYZ about exploiting user data? just rounding error in our accounting) or buy enough influence to get the regulations written so they don't actually impose a burden on them (but do impose a huge burden on potential competitors, the new startups that would otherwise be finding ways to disrupt Google's current business model, since users are clearly becoming dissatisfied with it).
The only thing that will fix this problem in the long run is for users to realize that there is no such thing as a service that is (a) free and (b) valuable. We are going to pay the costs somehow. The simplest way to pay them--with money--is also, in the long run, the best.
It sounds like your reasoning is “users will eventually wake up!” which I would bet a lot of money will never happen.
Because long term, users will realize that letting their data be sold is bad for them and will stop considering it acceptable. Indeed, that is already happening. And so, as I said, Google will have to continually become more and more evil to try to prop up their business model by further obfuscating what they are doing, until it becomes unsustainable and they crash.
> It sounds like your reasoning is “users will eventually wake up!”
More like: when enough users have suffered serious harm from having their data sold (which is only a matter of time--plenty of users already have suffered harm due to Google's incessant seeking after data--see for example all the furor over the "real names" policy, which was not just Google but they took plenty of flak for it), it will stop being considered acceptable. (Users who already correctly foresee such harms, like me, are already taking whatever precautions we can to avoid providing the data in the first place. I don't use Facebook, I don't use Twitter, I don't use any other social medial "platforms", the only Google services I use are search and maps, and I never click on ads. And I would be glad to pay Google directly for search and maps, if only they would let me do so in order to avoid having what data I do provide them sold to third parties. In fact, given that "freemium" is now a recognized business model, I don't see why they aren't trying it.)
> which I would bet a lot of money will never happen.
Then I assume you are long Google?
