Few reasons

1. While google does have free versions of this software they offer google workplace to companies who pay for more, features, and security. Allowing people to use it free makes more conversions for their paid software.

2. It forces you to use chrome. Since google docs features work best in Chrome most people keep using to to have the best google doc experience. Again taking market share from competitors.

3. A google account is a google account. All your data is centralized and keep you coming to them for all your needs. No matter if it’s email, cell phone, speaker, youtube, docs or any one of googles many free products.

4. Putting it all together : The value to google is you being there and using their products. Google makes it money on ads and anything the shows you ads is great. But anything that collects data on you to show targeted and and make targeted ad campaigns is even better. Other companies are willing to pay huge money for that information to target the exact person they think will buy their products. All of googles free products are paid for by the worth of your personal data they collect.