It is a shell company, except that it is not Google (or its equivalent) who is creating it. It is the Infosys and Cognizants (or other bodyshopping firms) of the world who create this structure to satisfy the demand created by the Googles.

The US loves its purely procedural legal distinctions. Shell companies are often not only legal but encouraged.

I mean classic example are contracting out food service in the corporate cafeteria. You contract the work to some random other company who hire people to do food service or do you want Google or whoever to start hiring cooks themselves? Janitorial staff is also a classic role for this style of employment.

What surprises me the most is how a corporation like Google is incapable of meeting temporary staffing needs internally, by shifting people already on their payroll around projects. It's as if they are just admitting that they are shit at managing projects and workloads and scoping work to the point that they need external help to plug these gaping holes in their load management.

How many people do they need to pay to manage this contractor circus? How much effort do they waste sourcing contractors, tracking work assigned to them, treat contractors differently even interns of security processes, and dealing with higher attrition levels? So much waste.