I think you may be taking "privacy" a little too literally. A "privacy fence" in your backyard does not literally shield your entire property from observation. But it interrupt sightlines and lower how "social" the space feels. When it comes to focus and productivity, that is often enough.
"When it comes to focus and productivity, that is often enough."
Based on your own personal criteria of what "enough" is. And what you're attempting to optimize for. An office is a place where people are intended to be productive. If _real_ privacy enables people to be the most productive then optimizing for something else (cost) is quite possibly a huge mistake on a long running timeline.
Having been in cubicles, I've overheard enough conversations from co-workers that should have been private related to both business and personal life.
I don't know what your experience is, but having spent years in a "cube farm", I'm intimately aware of the differences between having a cube and an open office. Distractions in a cubicle may be reduced but noise, smells, and other distractions are the facts of life when you have over a certain number of people within a small enough area. I've lived it, it's a half-measure and while it may improve productivity over an open office it's also just a cost-saving measure with the side-effect of having a tax write-off at the end of a day.
