As a web developer, I didn't see it as a big problem. We always do it to maximize ad revenue, find out where users leave to increase conversion rate, and simply to improve UX. But even when the intent is to improve UX, tracking is inappripriate.
Imagine if a robot vacuum recorded videos of your home and uploaded them so that bunch of ML engineers can see and use it to improve the algorithm. Or the videos of your car's camera (both of inside and outside). I mean, I'm not surprised if this is already happening, but it's a disturbing thought and should be regulated.
We can certainly develop functional services without tracking users.