What people forget is that Gmail, News, Maps, Picasa, Earth, Desktop Search, to name a few, each shook the world when announced and made competitors scramble. They bought Google oodles of free pr, permanently established the company as the most powerful thinker in web technology, helped them become a haven for the best engineers on the planet, and – by the way – probably helped drive their search and advertising volume into the stratosphere. How many other companies out there have figured out how to get their R&D budget to do double duty as marketing.
Gmail forced Yahoo and Microsoft to scramble to upgrade their online storage allotments. News forced newspapers to change the way they wrote headlines for the web, Maps ignited everyone’s love affair with AJAX and mashups. Picasa made the world realize that someone besides Apple could develop easy-to-use photo management software. And Earth and Desktop Search sent such a shudder through Microsoft that it made Bill Gates sputter with anger.
The folks at Yahoo love to flog this dog - that Google's success is overblown because the only thing it does well is search. Every time someone from Yahoo gets on stage to talk about what they are up to you always hear him/her talk about Yahoo’s zillions of page views and email accounts – about it being the most trafficked site on the web. So how come they can’t turn all that traffic into more cold hard cash?