Google needs a platform they control. They don't control the Erlang ecosystem, and they have learned the hard way how that fares (Java+Oracle+Android).

The other problem is that Google needs to build tooling that fits into their existing code base. In this case Java, C++, Python, Javascript and so on. They had to build everything from scratch anyway for Go or Erlang had they chosen either.

A lot of the nice things Erlang provide is already in place in the Google infrastructure. So you are aiming at small services which are isolated. This is a place Go has an easy way of getting going.

Of course, language familiarity also plays a large role. Go is pretty easy to onboard if you have decent Java or C++ knowledge. Erlang requires you to rethink the way you handle computation. Granted, the long-term benefits in productivity you gain in Erlang is significant[0], but adding more developers to a project is easy for Google.

[0] Whenever I write Go, I get frustrated at how much I have to write to do even the basic data munging. In Erlang, this has far better flow.