They're not saying that they should absorb open-source. They're arguing towards a strategy/direction for how to approach AI models from a business perspective,

They're not saying that they should absorb open-source. They're arguing towards a strategy/direction for how to approach AI models from a business perspective, laying down the facts that open-source has a superior positional advantage in terms of development costs. Probably, internally Googlers are arguing that the "AI explosion" is short lived and people will be stop paying for AI as soon as open source PC models become cost and quality competitive. So they shouldn't chase the next big revenue stream that OpenAI is currently enjoying because it's short lived.