Google charges a $300 one-time install fee for the free 5 Mbps internet and $70 a month for the 1 Gbit internet (install fee waived). Many people have calculated that they are making up the costs in just a couple of years.
I haven't seen it but I'd be willing to bet that the Google TV experience is far superior to what Time Warner and AT&T offer, which is horrible. They've been selling TV service for a long time and still have laggy and unintuitive on-screen menus and guides.
AT&T and Google both play the regulatory game but AT&T ends up gouging their consumers and not delivering on advertised speeds.