Well... yeah? If you let people advertise 'unlimited' but they can't actually deliver, you end up with a kind of market for lemons situation.
-----------------------------
There is a strongly utilitarian argument to not allowing such false statements.
It devalues the products of people that aren't bullshitting you. Say with fake-unlimited the "real limit" is 4TB before they start terminating you, but a different provider provides 5TB of capacity.
Because the former is allowed to outright lie, there is no way for the latter to effectively communicate that they are in fact offering a better product, instead they too have to make a bullshit "fake unlimited" claim to compete. Now because nobody has to actually back their claims with anything, they are infact massively incentivised to cut the "real storage" limits, because it will cut their costs, and they can still keep making the same claims.
Its a market for lemons[1] race to the bottom, and everyone loses, producer and consumer because scamming liars cannot be reliably assessed beforehand. So consumers lose faith in the entire market segment, and providers offering actual legitimate services become unsustainable.
[1] https://en.wikipedia.org/wiki/The_Market_for_Lemons
-----------------------------
If you allow sellers to lie about information-opaque things like this, you drive the entire market to a shittier equilibrium, it should absolutely not be allowed.
Not backing up SoundCloud or the entire Internet for $5 a month
Well, it still kinda is - the physical drives have to live somewhere... ;-)
Actually Google only offers unlimited to business and education accounts, so they're absolutely not referring to personal data.
People are too f'in litteral, first
Unlimited === Store everything every created
PERSONAL in the context of the discussion would include documents created by a person in general course of business, my point is very clearly and only pedantic trolls do not understand the meaning of point I was attempting to address.
Business use would be for the business that signed up for the service, not for storing an entire copy of SoundCloud
What if that business is Soundcloud? As far as I can tell, Google places no limits on business users, numerical or otherwise.