They got a nice break early on, which led them to a Microsoft-like monopoly over online search. Now, instead of improving the search, they’re diversifying like crazy, while the core business suffers.

I did a Google search on an unfamiliar topic the other day, and boy were the results bad. The entire first page was essentially snake oil vendors who figured out how to positioin their sites for the particular keywords I used.

So, all in all, praising a later approach that didn’t even generate the original success is silly.

Google sells electronic billboards.

Whoopee.

And further , acquiring successful services like blogger , orkut and youtube is also a part of their business model which is doing wonders for them.

1. Google was the best search engine right at the turn of the century, when massive numbers of people began using web search. So even though they no longer provide the best results, they have trained most common users just to use Google.

2. People forget this, but Google powered Yahoo’s search functionality from mid 2000 – early 2004. That gave them a tremendous boost and a connection to the most popular site on the web.

But all that aside, the reason for their outperformance is that search has fundamentally different (and better) economics than the core businesses of the other companies you mentioned, and Google focused only on search.

The main point of Carr’s article is that copying Google doesn’t mean you will get similar results, because it wasn’t really the existing Google innovation structure that created the search+advertising model that drives Google today. And that is still where 98% of their money comes from.

Brin and Page didn’t make Google what it is today because they spent 20% of their time on other projects. They only focused on search, and it was that relentless dedication that helped them get it right. They didn’t invent contextual advertising, they copied it from someone else. But then they decided to build their vision of an innovation utopia, and it has yet to bear fruit (financially speaking). Luckily for Google, their core business was strong enough to support that vision. Down the road, when times get tough some day, I doubt the culture stays as it is. We’ve already seen changes, and a few hints that even the founders question how well it is working.

“…their success is less a result of innovation and more a result of favorable economics and taking a market leadership position at the right time in history.”

How do you explain Google’s rise over Amazon, Yahoo, MSN and hundreds of other search engines?

How do you explain Google’s revenue and profit making ability relative to like companies?

Show Me the Money.