I've read that google's main goal for these free products is to increase the amount of time people spend online and not to monetize every bit of information that they come across. The more time people spend online, the more people see adsense ads. That's why Chrome and Android aren't spying on people's browsing habits like they technically could be, for example.
And to profile everyone to optimize those ads. People watch plenty of ads on TV. Google is rich because they have very special data used to price the inventory effectively.
There are a lot of companies I do business with that have sold my name to advertisers. Paying a company money doesn't mean they aren't going to make money off of you some other way too.
You should always worry about your privacy. Paid service or not.
Google makes its money building a profile about what it knows about you. In the light of placing files there, make of that what you will.