I think you have the causality wrong. They realized they had to get into the social space and integrate it into their product because of user data.

They are willing to make search worse in order to make G+ better.

I think the point of this announcement is that they make no such distinction. Search and Plus are the same product.

When I search for something in a search engine 95 times out of 100 I am searching for something new.

Thank you for your data point. I'm sure Google has many others. Not only that, but how much of that is because you haven't even thought of using search for information retrieval purposes yet? How often do you access your photos? How often do you access your friends' photos? What's your primary way to access them? What percentage of that access would be made better using search?

I am never looking for photos of myself. I mean please.

I bet you're the exception.