On the other hand it's good to check if really there are any people who would pay for that, before you start building it and spending real resources. This video is just an MVP to check the market and get some press coverage. So, in my opinion it's very good news - Google started to work in more methodological way on new products.
That doesn't work if you set expectations far beyond what you can deliver, though. You can show that people are interested in flying cars by showing them the Jetsons, but if you can't achieve that in your product, it is useless (perhaps even damaging) information.
On the other hand, if Google knows they can achieve what they show, then it's a good strategy. But if they don't have the tech in hand and just "think" they can achieve it, things won't go well. At best, they'll release a product everybody thinks is subpar. At worst, they'll never release as they keep trying to reach the goal they set for themselves.
