This gotcha only works if you are a user of only their free services.
When Google charges me a monthly fee for storage, takes a percentage of my Play Store sales, or manufactures a Pixel that I purchase from their online store, I am absolutely their customer. I may also be providing data they will sell, but I am still paying them for goods or services and that makes me a customer.
The problem is that they continue treating their customers like livestock, and it seems they have little incentive to change.
They can treat their customers like livestock because their customers are okay with it. Why is that?
My hypothesis: turkeys think the farm is an amazing life until the week before Thanksgiving. Nobody really groks that Google is shit until it's too late.
The real problem here is that all those businesses are rounding errors on the balance sheet compared to ads, so the CEO doesn't care (or even know) about the issues and isn't motivated to improve anything.