Ask anyone these days, they will tell you the future of the web is largely based on how we interact with one another. Bundle this mindset with video and you have where Google is trying to take things in the future.
To help further this along, Google is also hoping to include the purchase of a video compression company in that it might give them an even bigger edge in the long term.
While I am sure On2 will also be making their offerings available to others outside of Google still, I am fairly confident that Google found this to be a logical purchase for them as it also means that they can take their own video efforts into the next level. How will all of this play out in the future? This remains to be seen, but I suspect it has a lot to do with the way browsers are going to be handling video in the future.