It remains to be seen, and likely forever will, whether large corporations suffer from some unavoidable, fundamental flaw that prohibits them from innovating. As a casual observer, it seems to me that Google is very aware there is a risk of that, and its executives consistently make moves to mitigate it. They silo small innovation labs like Google X within the company, they fund "moonshots," and they acquire as many innovative small teams as they can. They do all of that with more resources at their disposal than almost any other company in the world. So it stands to reason that if Google is consciously aware of the risk of innovation slowdown ("turning into Microsoft"), and actively throwing more money at avoiding the problem than any other company on the planet, that they have a far better chance of continued innovation than "the underdog."
A comparison I think is valid is if an
- Your communications (Gmail, Hangouts, Voice)
- Your working data (Drive, Docs)
- Your footprint on the Web (Google Analytics, Ads)
- Your footprint on the Internet (Fiber, Loon)
- Your browser (Chrome)
- Your operating system (ChromeOS, Android, GlassOS)
- Your device (Chromebooks, Glass, Wear, Android phones and tablets)
- Your movements and travel (Maps, Ingress, ITA)
- Your robotic overlords (Boston Dynamics)
Not to mention the upcoming plays for home integration (Nest, Thread), your means of transportation (Android Auto, self-driving cars), and your activity and health data (Fit).
Each vertical success reinforces the Google Platform, and lends momentum to Google's efforts in other verticals. It presents one hell of a barrier for start-ups (unless you fancy share-cropping), decreases consumer choice, and ultimately, that amount of consolidated power just doesn't seem healthy for a functioning market or society.
Edit: All of that, and I somehow forgot YouTube. And G+. But we all forgot G+, right?