The intent is faster speed, greater independence and run like leaner startup. Also, additional career paths for employees, especially for the senior folks aspiring to be CEO.
So long as Sergey and Larry (& Co.) keep from micro-managing, I think this structure will be enormously beneficial. I can't see how someone running Google's web properties would be able to move quickly when also having a hands-on responsibility for developing a self-driving car and a glucose-sensing contact lens.