Why would someone go for this when cheap dedicated host providers like hetzner etc offer powerful dedicated servers with 64GB memory and multicore server grade CPUs? The comparison only gets worse taking into account that Google's offering is preemptible and can shutdown and come up as they wish.
[1]: https://cloud.google.com/compute/#pricing (0.12x24x30)
But time and time again I see infrastructure where people pay for these services for large amount of instances that are running continuously, blindly assuming that it's cheap because it's cloud. There's a bizarre level of price-blindness amongst certain subset of customers of Google Cloud and AWS that I've never seen anywhere else.
Similarly, if you're running hosted app that on most hours doesn't overload a single server, on peak hour fills three hosts, but on a large advertising event or accidental viral link takes fifty hosts for a day, and then goes back to normal - then you don't want to run it on VMs where you have to pay for them by month.
Nothing stops you from mixing and matching dedicated servers with handling batch jobs and peaks with cloud servers. In fact, most data centre providers can offer the full range from unfurnished colo space to cloud offerings out of the same data centre these days - either directly or via partners hosted in their buildings. At least that's my experience.
If you're going to use the cloud you have to do it right, and that means auto-scaling and variable resource usage. Then this option will save you money.