I'm sure there's more engagement with Reader than Plus, with its millions of users who don't really use it (many of whom aren't even really aware that they are signed up for it).
So the question becomes not "why is everyone using them?" or even "why are they doing things like this?", it starts with people like me who got to ask themselves honestly "why do I keep relying on these guys?".
Gmail is my main email account and it makes me deeply uncomfortable. I love OS X, despite its ever-increasing flaws, and that makes me feel like a hostage experiencing Stockholm syndrome. Facebook is the only thing in this category I actually stopped caring about on my own, but if I'm being honest that's more my friends' fault for re-enacting soap opera scripts online and offline, and less because Facebook is a data-grabbing virus that screws its users over at every turn (which it is).
My only face-saving answer to that conundrum is those products offer me some things that others don't, they have features that large companies are better positioned to deliver on. However, that's not a permanent state of things, as the complex features of yesterday become increasingly more feasible for smaller developers to tackle tomorrow. Maybe it's a good thing that Google and others are finally straight-up bent on filtering nerds like me out of their customer base, maybe that's the kick needed to overcome inertia and complacency.
Even for search, there are really only a few companies crawling now -- Google, Bing/MS, and Blekko. I'm going to try Bing for a month (I tried in the past, and it wasn't great, but was close) and Blekko for another month, but I'm pretty sure I don't care about any other Google services.
Boy, you really summed up my own personal feelings on this. I'm beginning to rethink my own Gmail usage now.
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OTOH I do feel sad that reader is gone as it has been a part of my daily life for many years now. Some say that RSS is dead but I cannot find any alternative to feeds I've collected.
Working.
/mutter.
Google reader had decent random recommendations before the G+ update. I believe that a good recommendation system can guess relevant items for given user, but that was not what google reader has been doing for some time now.
I know there is an ad service for the feeds but as far as I am aware they aren't very profitable.
Maybe there simply isn't a good upside to keep this service going and its a business decision?
