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I…really don’t think it was ever about engagement. I think most free users just didn’t have an adblocker.
I think ublock orgin’s adoption just picked up over the years, and it’s not as if Youtube gets cheaper (I’d imagine it just gets more expensive)
I mean engagement is great, they make the algorithm work (well, “work”) but I’m pretty sure the ads were the selling point (for google) before premium was even an option.
Google is an advertising company. That’s how they make money. Everything else they do – search, youtube, apps, phones – is just an ancillary sideshow that’s a vehicle to showing people ads, or gathering data on them to use in showing them ads. So you are 100% correct.