Horizontal, not vertical
Thompson reasons that Google is now clearly focused on horizontal markets. Like Microsoft before it, Google wants its products to reach as many users as possible, and it does not particularly care about providing an integrated end-to-end experience. Microsoft wanted to sell operating systems and applications software; Google wants to sell advertising against services that are free to users. It's the opposite approach from Apple, which wants to sell hardware with integrated software and services.
If so, Chrome is the obvious choice to take Google forward. It's cross-platform, which means it reaches the largest number of people. It's entirely Web-based, which matches Google's business goal of keeping users on the Web for as long as possible, where Google can collect data about them and target ads to them.
Maybe -- around the time that the Android team was made to report to Chrome's leader, I also heard speculation from people close to the company that Google wanted a way to bring hardware advances that it discovered or acquired to market. The company had recently put co-founder Sergey Brin in charge of special projects, including consumer electronics gear, at the Google X skunkworks division.
What would happen if Google X created a quantum-leap advance in something like battery life? Or digital camera processing? Its Motorola Mobility acquisition would give Google a way to bring this technology to market fairly quickly, without having to outsource the hardware design to a partner (like Samsung, HTC, or Asus, which make the Nexus-branded devices for Google) that could then learn from and mimic Google's technology.
Motorola Mobility is an affordable expense for Google, especially when you factor in the value of its patents. And who knows? Google may yet become a top-tier smartphone manufacturer, which would give it even more leverage to push its services into mobile and crack the mobile ad market.