On the one hand, I agree. SWIFT recommend (in a similar vein) that machines that you do SWIFT tasks with are segregated from your daily driver last time I read the SWIFT standards; Microsoft recommend locked-down, no-access machines for a lot of AD admin tasks. If you do work in "I can tank a bank" roles, this will sound familiar.
On the other hand, this will also lead to cargo-cult "but Google programmers don't need Internet access, why do you?"
On the gripping hand, perhaps a bunch of Google people being restricted this way will lead to an resurgence in development and documentation practises that don't assume that you can download crap from the Internet all the time. That would be nice.
There's internal sites for searching, documentation, code, forums, newsletters, Questions/Answers, chat, calendar, video conferencing, browsing memes, looking at cat pictures and probably more.
Just a random thought: this coincides with the rollout of Bard. Perhaps the idea is that Bard (or its internal equivalent) is a suitable replacement for sites like StackOverflow?
To which the obvious reply is, Google already has the whole Internet cached and indexed. If they need to Google something they are only accessing the intranet.
Perhaps a follow-up program ends up with a Qubes-like configuration, or just separate systems.