I think google is banking on the fact that despite all this, people will stay with them and give a very slim discount. But only once they complained loud enough. The do trade-ins all the time.

The thing is, bi-yearly phone replacements are not needed for most people anymore. Recent mid range phones can last double that.

Performance is good enough with modern SOCs. And new sets don’t have new essential features, so keeping them alive for cheap is a no brainer for most. Especially if support is promised.