If Gmail proved anything, it was that people would, for the most part, accept any terms of service. Or at least not care enough to read the fine-print closely.
Paying for services and still not getting any privacy is largely a result of the equally naive attitude that a paid product is superior to a free one.
In reality neither free nor paid is an indicator of quality and a lot of the time enforced regulations are the only thing that can really prevent a company or organization from putting its own self-interest over that of the customer whenever possible (even though some companies and organizations might do so even without being forced to).