Note that they'll also be reducing the free bandwidth and CPU-time quotas. Bandwidth goes to 1GB in/out per day and CPU to 6.5 hours / day
On the other hand, I want a well-supported platform from Google and if reducing the free stuff means they have a good business model, can hire more engineers, etc, then that's a good thing.
Thats a hell of a downgrade.
Most web hosting companies to not depend on extraordinarily price-conscious highly technical people for their bread and butter.
Could you have gotten Wordpress working on Google without having an engineering degree? Could you have set up a simple brochureware site without an engineering degree? These are common customer requirements among the cheap, mass market web hosting companies.