At Google, "there are some in the works, but acquisitions take time," Dodge says. Google bought 40 companies last year, and Dodge refers some of his startups to Google's mergers and acquisitions group. But there are plenty of ways Google can help a new vendor without purchasing it.
"I think there are several levels when we see companies," Dodge says. "The first one is can we partner with them. Can they build applications on our platform, and make the platform more valuable. The second level is can we do a business development deal with them, or a licensing type of deal. The third level is acquisition, and then there's even a fourth one which is Google Ventures, the venture capital arm of Google. We may find companies we want to invest in."
Taking a page from Microsoft
It's easier these days to create a tech startup. Instead of building out giant data centers and new hardware systems, you just need a talented team of developers to build software applications on top of existing platforms. The platform is often Facebook, but it can also be Android, Chrome, YouTube, Gmail or the Google Apps Marketplace.
Many startups are "a feature masquerading as a company," Dodge says. "But you can do that today. Applications are basically single features. You can do that today, but you couldn't do that 10 years ago."
The most popular platforms now are Web-based, such as those pioneered by Google, Dodge says. But it was his former employer, of course, that perfected the art of creating developer platforms.
"Microsoft wrote the book on building developer ecosystems back in the PC days," he says. "They were the best in the world and they're still very powerful when it comes to Windows-based applications."
Many Google executives would argue that the Web, and products such as the Chrome OS operating system, will eventually make Windows irrelevant, even though Microsoft's operating system still powers 80% to 90% of all desktops. Dodge uses the past tense when he talks about Microsoft's dominance.
"IBM (IBM) had their time. Digital and Sun and Apollo, they had their time. Microsoft has had their time," he says. "And now the cloud-based systems, like Google and Facebook and others, will have their time. It's a natural progression of business. Microsoft had a hell of a run for 30 years. They're still a very powerful company, very profitable, growing very well. So I wouldn't say they're going to go down, I would just say that the market has moved."
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