What happens in this situation is the people who used to make the obsolete things are now out of a job, and eventually get employment somewhere else. What they

What happens in this situation is the people who used to make the obsolete things are now out of a job, and eventually get employment somewhere else. What they do then counts for productivity. If they earn what they did before, you'd measure no change in productivity -- though we'd all be better off. The studies in the article assert that the size of the productivity shortfall is so large that even if we place pretty generous values on all this free stuff we have now it doesn't fully cover the gap.