I think there's another way look at this. Per "Zero to One" Google is a very powerful monopoly. It wants to protect that position, as well as make it less noticeable.

All these "side projects" create the illusion that Google is not a monopoly. More importantly, new Product X, whatever it is, helps to attract new top talent. Top Talent is going to want to fix old things, they want to build new.

While this might sound a bit extreme, even if it's not actually true (in tandem) both of these "incentives" are real. Google does need to mask its dominance. And it does need to attract top talent (if only to keep soneone else from acquiring it).