Without commenting on the specific of Google Workspace, in general, this makes sense if you’ve added a bunch of additional value.
In fact, ironically, Slack’s antitrust complaint against MS re: Teams is precisely the fact that they bundled all this additional functionality in without charging extra for it.
Now we pay $10/mo. If you average it out, it's not too different than just paying for the added value as it grows.
And worse, if I cancel I don't keep to keep using it without the added value. So I'm painted in a corner. It's objectively worse in that sense.
This seems like they are using a marketing plan from the boxed software days to justify a price increase today. I wonder if there’s a 90s Microsoft person who was tasked with a back strategy after Google decided they wanted higher profits or slower growth or some reason that has nothing to do with reflecting value.
I think there’s some places where SaaS makes a lot of sense. And storage costs and high data transfer volume…. It makes sense.
There’s a balance. Modern software leans too heavily to subscriptions though.