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Would you pay for the added privacy?
(They market it as "for business", but I know several people who pay for it on their personal domain just for fewer ads, and once subscribed myself just so I could get a me@customdomain.com GMail address & YouTube account.)
It works well for people with disposable income, but a small minority of America has disposable income these days. Google probably makes a lot more money selling advertisements against everyone else than they would if they charged everybody for products, and it lets the general public access products that they'd never get otherwise.