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Pretty much every VC backed startup for the past 15 years uses that model. Startup success is in a large amount "who can use internet ads the best".

Those businesses operating at a loss are a tiny fraction of the "real economy", even though they may be giants in the future.

What does that have to do with anything? Using Google Ads is not a requirement of having your website be accessible through Google Chrome. It's not analogous to this situation at all.

But at least there are alternatives, even if Google is dominant in the space.

Competitors set those prices, not Google.