Google is a business and so as long it isn't illegal, they have the right to do it. Whether it's smart in the long term, profit-wise, compared to short-term, is another issue. But you often see companies start making BDC (Big Dumb Company) kinds of decisions after they reach a certain size and culture and market/feature maturity -- they run out of places to grow their revenue in less slimy ways, or at least, they think they have.