To complement the $8 billion pile of cash it already has in its coffers, Google is raising an additional $2 billion cash in a secondary offering. The reason for the offering given is that Google wants to ease demand for its shares as it transitions into the S&P 500. Perhaps Google thinks its shares are overvalued and wants the benefit of the overpricing accruing to Google as opposed to speculators. Others contemplate a Google-Microsoft deathmatch that will drain the resources of both companies. Another possibility is that Google will use the cash to buy up other, smaller companies. However, Google hasn't been particularly acquisitive in the past, other than the recent AOL and dMarc deals. Compare to Yahoo! and Ebay, both of which have been acquisitive and have overpaid for some of what they bought.
If we discount the possibility of a deathmatch and a string of acquisitions, then what's left on which Google can spend its money? Well, there's always capital expenditures. But it seems a challenge to run through this kind of cash on capital expenditures, if you are a picky buyer. In 2005, Google spent a little more than $800 million on this line item and it seems to have bought well. The bandwidth for Google Video must be unreal, because I never have any glitches when accessing a video on the service. Google has admitted that it purposely overbuilt its infrastructure for Google Video.
Your speculation on what project or projects would require such a cash horde for capital expenditures is welcome.