Inside Google

Internet giant Google is leading led the tech sector in acquisitions this year, buying almost twice the number of companies as second place IBM.

The data, compiled by CB insights, shows Google has announced 23 acquisitions through Sept. 24 compared to IBM’s 12. HP and Facebook followed the leaders with seven and six respectively.

Microsoft has bought nothing. Nada. Zilch That’s certainly not for a lack of money.  Here’s the chart from CB Insights:

Frank Reed at Marketing Pilgrim says Google is following the lead of Cisco:

“Cisco has been smart enough over the years to understand that if they wanted a technology or the talent around a technology they would use their deep pockets to purchase those assets rather than develop them themselves. They have done this over 140 times since 1993.”

He contrasts that with Microsoft and says the lack of purchases demonstrates the software giant’s mindset:

“They are who they are and they try to be other things from the inside out. Unfortunately for them, who they are on the inside isn’t working in the new world order of the online space thus many of their efforts to stay current have failed and created an image of a bloated cash cow dependent entity that is not an innovator.”

I think Reed may be on to something.  When you think about it, Google itself really innovated one thing: search.  Virtually every other significant product was the result of acquiring a startup and then refining it at the Googleplex.

Give Eric Schmidt, Larry Page and Sergey Brin credit for knowing good ideas when they see them.  And, their $25 billion a year advertising juggernaut gives them the deep pockets to act when they please.