Remember: Gmail, Youtube, and Google Docs are not the products. You are the product: your surfing and web-usage habits are gold to Google, which they trade to advertisers for cold, hard cash.
This sort of move relies on an uninformed public: remember, far too many web-users don't know that browsers other than IE6 exist, and type into their search engine as though they're talking to a person. (As an aside, it's 2012: not knowing how the web works is no longer okay.)
There are some steps you can take, though, to keep Google from breathing down your neck and targeting you with creepy ads. You can keep yourself logged out of Gmail, Maps, Docs, and the like when not actively using them.
You can also nuke the already-gathered data associated with your account.
How to Clear your Google History
There is a video below which shows how to clear your Google browsing history, which we'll also explain here. It's very easy:
- Sign in to your Google account and visit google.com/history.
- Click "Remove All Web History", then click "OK".
- If for whatever reason you want to re-enable Google's web-history logging, you can do so on the same page.
- Corporate users: if your email service is managed by Google, then this page won't activate for you. Just make sure that you follow the steps above for your personal Gmail or Google services account if you've linked your private and work emails.
Android users: in case you were wondering, it's actually possible to use an Android smartphone without a Gmail account, but the user experience would be horrible. Nothing would sync, you'd have to manage all of your contacts by hand, and none of the third-party apps (i.e. the only ones you could use) would communicate with each other properly. Just as an iPhone requires an iTunes account, an Android phone requires a Gmail account.
(Yes there are homebrew-firmware options to mitigate this, but are you really going to build your own branch of Android? I, for one, won't.)
There are advantages to using the Google ecosystem, but it's a matter of limiting your exposure, both in terms of targeted-ad creepiness and consolidated-data risk.