Only tangentially related to the post: you know that bit about firms ridiculously underinvesting on SEO? This has been true over and over and over again in my experience. If you somehow manage to avoid that pathology, you will eat your competitors' lunches.
In that there are some people doing good things there, some people selling snake oil, and a lot of doubts in between, it would certainly cause firms to invest less due to doubts that they'd be getting anything worthwhile.
Optimizing for humans via playing with Google's algorithms is a false dichotomy. It is hilarious in the context this usually comes up in, which is "We spend $Y00k on AdWords optimizing for humans but can't scrape together $X0k to do that fiddly SEO stuff playing with Google's algorithms."
In cases where the two are different, perhaps. But optimizing for humans is actually a core part of SEO.
Step 1. Find what people are searching for.
Step 2. Provide content that meets their search criteria.
Result: You have optimized for humans.
Obviously there are other ways of optimizing for humans. Some of those ways might even bring greater returns. But you don't necessarily have to choose between SEO and those other ways. The optimum strategy is usually to pursue both when possible.
Sure, but SEO has little to do with that anymore (heck I could be a SEO consultant if that was the case. All I had to do was to say "use accurate and descriptive titles containing the words the user searches for, ban flash, provide descriptions of all your images) these days most of what they do is find and abuse slight flaws so they get to rank just a little higher, for just a little while.
