Did Google just create a test environment for startups with Google App Engine?

Did just create a no-risk way to “fund” potential startups by providing them access to free tools and space?

Is Google outsourcing / crowdsourcing the development of future Google Apps by allowing them an early, first-hand look at applications created by developers using Google App Engine?

Y Combinator has had results by giving small teams small amounts of money for short periods to time to provide entrepreneurs with the environment and infrastructure to test creating businesses. The funding model is increasingly relevant as quick, iterative product and company development remains highly competitive and the cost to test and deliver applications gets lower.

Maybe by wrapping the pieces together Google created an easier environment for test applications and test companies compared to the Facebook platform and Amazon component system of web application services.