I also think providing a service for free is fundamentally anti-competitive. It’s like the ultimate form of dumping. And there are many studies showing that people are irrational about zero-cost goods, so it’s even harder to compete against than might be expected.
There are endless studies, such as this [1] demonstrating a significant inverse relationship between ads and happiness. The more ads, the less happy people are. And I think it's very easy to see the causal relationship there. And this would apply even if the ad industry wasn't so scummy.