People are creeped out and think phones are listening to them, privacy regulations around the world (GDPR and the California one) are making it very hard to do targeted ads, etc.
Nobody thinks that. Just a handful of loud ones. Look what happened after Snowden. Did people start spending less time using their phones? The biggest step they took was covering their webcams via tape. Nobody cares that they are being watched as long as it doesnt make the news.