Google is great at search, with their newfound cash they are good at acquiring other companies that are good, but their other various ventures are so so.
I read Ries & Ries as often as they update, they have some really great points in a recent article:
http://www.ries.com/Articles/popupAdAge.cfm?ID=74
They need to focus on collecting and indexing information and making it available. An AJAX based office suite? Get outta here... not possible any time soon... a new OS? Come on... the relationships they would have to establish with hardware vendors, software developers etc..etc..etc..would drain more of their resources and further dilute their brand. Google = Searching for and finding stuff imho.