I had to go to great lengths to disable location history, and Google penalizes me for it by disabling search history in Maps as a result. I'm sure 99% of people don't go to great lengths to disable location history and so yes your entire history of GPS locations is basically saved to a Google database as far as I remember. (Note I'm obviously a user recalling details from years ago and not a Google employee/developer. My perception that Google collects all our GPS details forever by default is based on reality, whether or not that means you as an employee would actually be able to do anything with that data.)

> The widespread assumption that Google collects all data all the time and uses it for everything is ridiculous.

Maybe they fail to use it competently but it definitely collects a lot of data and attempting to stop it results in punitive reactions and disabling of features not needing it - and repeated badgering to permit Google to collect data again.

Google also collects data that I was initially unaware that it is collecting.

"Yes, Google might collect location data even when you’re not using Maps (there are a lot of passionate, dedicated Timeline users), but you have to have that enabled"

Of course that opt-in requirement was only the result of a hard-fought class action settlement.

Take this with a grain of salt as my recollection of the litigation is somewhat hazy. But I believe Google argued, even when a user opted out of location tracking, Google could still keep the data for its own uses. Ie opting out of location tracking simply meant the user didn't have access to their location history, it didn't show up on the phone (couldn't be searched by suspicious spouses) etc.

I believe they also collect location data when you're not using Google Maps for the purpose of updating their database of wifi locations (that they then use for location tracking). There is an agreement for this too, but the Android phones I've had regularly spam you until you agree to it.