Google neither needs nor cares about all of the information having to be accessed through their servers, it only needs to be able to access it via its crawler.
Independent physical machines have many more options for denying access.
A stripped-down OS hosting a browser for quick access of web applications removes some of them, and the kind of direct and seamless delivery to online servers is finely targeted to the majority of users who will not think to restrict such access.
Google's AdSense network, which most websites use to get advertising bucks, is not dependent on hosting content on Google's servers.
My point is that AdSense is dominant, and it approaches dominant with a capital D.
As an example, Google's largest initiative recently is the 'reinvention of email', which is Google Wave. Google Wave is completely federated, like SMTP. Anyone will be able to get the source of a Wave server, host their own accounts, and even host private conversations between two servers without Google being in the loop.
Let's just hope one person in that loop isn't a noob running a ChromeOS notebook and accessing it with a Google App.
Also, they are able to pick up information about you through AdSense or Analytics, although in practice, Google's AdSense targeting is not behavior (based on tracking you) driven, but based on content.
That's how it is now. The incumbency can allow for future alterations.
Well, as I pointed out, many of Google's initiatives do not mandate Google be involved. Anyone can download Android and remove all of the Google Apps integrations. Anyone can build their own version of Chrome that does not send a single packet of data to Google's network.
Anyone can, but the dominant distributor will most likely be Google, and the preponderance of users will not.
Google offers the tools of online advertising commerce (if it doesn't just stiff them), it offers email, it wants to offer on-line health records.
The content of people's lives is what Google is indexing, and it has greater say in what they see or earn online.
Google's tendrils via it's open source and open specification initiatives can only be maintained with public participation. It's all too trivial to remove them.
In isolation, each individual initiative may be trivial to excise, though the bulk of the populace would not bother.
The ecosystem Google wants to establish and place itself as the first encumbent can make things less easy.
In fact, Google's whole FCC Auction gambit was designed to ensure that people could install whatever they want on phones without being firmware locked, which actually undermines the ability for Google to control Android forks on devices.
Google's entry into the spectrum debate was an outsider to established players.
The test of its altruism will come when it finds itself on the other side.
Let me just preface this with the fact that I have family members working for Google and I am privy to lots of internal discussions, as well as knowing lots of managers at Google due to prior working relationships. Googlers are practically indoctrinated from the point of hiring with "do no evil" culture run by a Department of Corporate Culture, that originates from the top down.
I am not entirely comforted by this.
It's all well and fine for you to speculate in the absence of information about internal corporate dialog, but as ridiculous as it sounds, Google is run internally in a very academic and idealistic way and until the recent economic crash, there wasn't even much talk of even finding ways to monetize most Google products. Employees were encouraged to spend 20% of their time on side projects.
Internal dialog is nice and non-binding.
Nobody can hold you to things you mutter to yourself.
The company from my knowledge is not via traditional MBA-learned management techniques, but is more or less, a unique Silicon Valley creation.
Neither was certain company based in Redmond, at least not at first.
When you see Googler's pushing for these projects, think not about corporate planning at the top, but rather, idealistic young Stanford graduate employees who are religious about openness and bent on trying to change the world.
I love the road of good intentions they've paved.
Google by its very size and reach warrants some level of mistrust, no matter how internally pure its members are or believe themselves to be.
It does not take much to take the levers they wish to move the world with and apply them in a less idealistic direction.
As you've said, economic conditions have already forced some of that.
(and in case you think this is naivete, every Friday, Google has a company wide video conference/town hall, in which any employee can directly ask Sergey or Larry questions, and you will find quite a number of contentious employees worried about evilness forced by recent economic conditions, by an overemphasis on trying to monetize users too much)
Let's hope the dear leaders live forever, then.
It's all nice internal, non-binding deliberation, and apparently a lot of worried employees.
To paraphrase Yoda:
Circumstances lead to Monetization, Monetization leads to Rationalization, Rationalization leads to ...